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08 July 2020
This article outlines the financial support available to employers in Jersey that have been adversely affected by measures introduced to manage the spread of COVID-19.(1)
Phase 1 of the payroll co-funding scheme is a short-term wage subsidy measure which was introduced in the early stages of COVID-19. Eligible businesses can apply for £200 per week towards wages paid between 20 and 31 March 2020.
To be eligible for Phase 1, businesses must:
Businesses can apply for £200 per week for employees who:
For employees earning lower amounts, 60% of wages will be paid for the proportion of the month that was affected by the restrictions.
Employees earning more than £10,000 a month (gross) do not qualify.
How to apply
Applications for Phase 1 closed on 30 April 2020.(2) Payments will be made from the beginning of April 2020.
Phase 2 of the payroll co-funding scheme follows Phase 1 but offers greater financial support over a longer period (1 April 2020 to 31 August 2020) to a wider range of businesses. This scheme may be subject to extension. The government will subsidise wages up to a maximum of £1,600 per month to help businesses reduce their costs and protect job prospects in the longer term.
A wage subsidy can be claimed:
A wage subsidy is not available for staff employed through a third party (eg, an employment agency) or employees who earn £4,558 or more per month.
All of the following requirements must be met:
How to apply
Phase 2 support will be available each month for April 2020 to August 2020. Payments will be made from early May 2020. Businesses must pay staff wages before claiming and must present wage records with their applications. Applications should be submitted online each month here.
Where a business is applying for a special exemption from paying 20% of wages, it must provide pro forma cash flow forecasts for the relevant month, as well as additional declarations and financial information as part of its application, including that the change to hours or pay has been agreed with employees and that the business has considered all options for managing its working capital.(4)
To help businesses and self-employed individuals with their cash flow, businesses may be able to defer social security contribution payments. Postponed contributions will be held on the businesses' account and payment will be discussed in due course.
Businesses with fewer than 80 employees and individuals who pay Class 2 contributions (including those who are self-employed) are automatically permitted to defer their payments for Q1 2020 and Q2 2020 (payments due in April 2020 and July 2020) by 12 months.
Businesses with 80 or more employees which can demonstrate that they have been significantly adversely affected by the COVID-19 pandemic can apply to defer their payments for Q1 2020 and Q2 2020 (payments due in April 2020 and July 2020) by 12 months.
Whether deferring payments or not, businesses must continue to submit quarterly schedules.
How to apply
For businesses with fewer than 80 employees, deferral is automatic; it is not necessary to contact the department to request permission.
Businesses which have 80 or more employees and can demonstrate that they have been significantly adversely affected by the COVID-19 pandemic should contact the government's Social Security Contributions Team by email ('email@example.com') or phone (+44 1534 444 444) to apply to defer their payments for Q1 2020 and Q2 2020 by 12 months.(5)
For further information on this topic please contact Jonathan Hughes, Helen Ruelle, Bruce MacNeil or Will Austin-Vautier at Ogier by telephone (+44 1481 721 672) or email (firstname.lastname@example.org, email@example.com, firstname.lastname@example.org or email@example.com). The Ogier website can be accessed at www.ogier.com.
(1) This article looks at the government measures aimed at employers. For information on all available measures, please see "COVID-19: government financial support for businesses". The information in this article is correct as of 26 June 2020.
(3) The included sectors are those marked in green here.
(4) Further information is available here.
Kate Morel, senior paralegal, assisted with the preparation of this article.
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