Coronavirus – what next?

Since our previous briefing about some of the key issues that employers of UK-based staff should be considering in light of the COVID-19 (Coronavirus) outbreak, the World Health Organization has declared it a global pandemic.

Yesterday, the Government promised to do "whatever it takes" to tackle the virus including announcing a package of financial measures estimated to be worth £350bn to shore up the economy and to assist employers in these challenging times.

Notably, the Government announced that it will be delaying the implementation of the changes to the off payroll working rules (known colloquially as IR35) until 6 April 2021. Although this will undoubtedly alleviate the burden on some businesses and individuals at this time, employers will still need to continue to prepare for other changes which are scheduled to take effect on 6 April 2020 which include:

• changes to the requirements for written statements of particulars of employment;
• changes to the taxation of termination payments;
• the new entitlement to parental bereavement leave and pay; and
• the annual increase in certain statutory payments, such as statutory sick pay, statutory maternity/adoption/paternity/shared parental pay, a week’s pay relevant for calculating statutory redundancy payments and Tribunal compensation awards.

Whilst we await further measures to be announced in the coming days to assist businesses grappling with the consequences of the Coronavirus pandemic, ACAS has issued some updated guidance which can be found here.

There are also numerous practical issues for employers to consider when balancing the competing interests of ensuring in the short term that the business can continue to operate as effectively as possible, whilst protecting the well-being and job security of their staff, as well as keeping an eye on the medium and long term consequences of these often difficult decisions, including:

1. What pay should you provide employees who are self-isolating with family in circumstances where they are still well? If employees are still able to work from home, they should be entitled to receive their usual rate of pay. If they are unable to work, Government guidelines state that the employee can be paid Statutory Sick Pay. Small businesses may be able to claim a reimbursement as outlined by the Government in its recent proposals.
2. What will be the position when schools close noting that the Government has announced today that schools in England, Scotland and Wales will close from Friday? No specific provisions have been announced to support parents who are required to stay at home to look after children. Pending any specific Government assistance, employees may choose to exercise their right to emergency time off (unpaid) to care for a dependant. Some employers may have policies offering additional support for employees in these circumstances.
3. What is deemed to be “essential” travel? Can we require people to come in to the office where there are operational reasons? There is no specific Government guidance as to what “essential” travel means. Employers would be well advised to consider queries on a case by case basis, reflecting on their general duty of care to employees in these circumstances.

Regrettably, and despite the Government’s recent announcements, some business are already considering the economic consequences of the pandemic, including assessing ways in which they can reduce staff and associated costs in the short to medium term.

We are working on creative solutions with employers of all sizes assessing possible measures ranging from requiring staff to take accrued holiday, sabbaticals, changing working hours or remuneration packages, through to lay-offs (where there is a contractual right to do so or even when there isn’t) and voluntary and compulsory redundancies, potentially made in a shorter time frame than usual.

We await further Government announcements as to what, if any, additional financial support may be offered to employers and employees alike.

In the meantime, if you would like to discuss any of these employment related issues or potential options available to your business, please contact a member of the CMS Employment Team who would be happy to support you.

Briefings about many other legal issues arising for businesses as a result of the Coronavirus pandemic are available here.