How long does a claim take?

A reduction in hours or salary or changes to hours or patterns of work is a contractual change – you can’t just impose it without significant risk. The same applies for lay-off or short-time working where there is no existing contractual right to impose these.

In summary, the process that an employer should follow to implement these measures is as follows:

1. Communicate the Company’s position clearly and the urgent need to achieve temporary cost-saving to ensure the ongoing financial viability of the organisation
2. Explain the proposed changes in detail and seek the employee’s agreement, and
3. Record the agreed changes in a letter which is counter-signed by the employee.

If employees will not agree then employers will be at substantial risk of claims for unlawful deduction of wages, breach of contract and/or constructive unfair dismissal if they seek to impose these changes unilaterally. Employers should be mindful that this approach is likely to cause significant employee relations issues and dissatisfaction if only some employees agree to a reduction in pay. Employers should have a clear strategy for what their approach will be if this is the case – for example, they may wish to instead explore a different measure such as redundancies. This may form part of the employer’s communication when explaining the reason for the changes and seeking the employee’s agreement.

Unions: Employers should also be aware that where there is a recognised trade union in respect of any part of the workforce which is being asked to agree to a change to terms and conditions, the recognition agreement or collective agreement will require the employer to consult and/or negotiate with the trade union in the first instance.

Collective consultation: Where 20 or more dismissals are proposed at one establishment in any 90-day period, there are stringent collective consultation rules which apply (regardless of whether the employees have two years’ service or not). All dismissals count towards this total unless the dismissal is “not related to the individual concerned” – therefore dismissals for things such as conduct or capability do not count, but most other dismissals will count. This will include where you are imposing changes to the contract such as reduced hours or pay.

The rules on collective consultation set out a prescriptive and time-consuming process which must be followed, and minimum timescales before any redundancies can take effect. The cost of any claims relating to failure to follow collective consultation requirements are substantial, and specific advice should therefore always be sought before seeking to implement collective redundancies. We will be publishing further guidance on this on the Hub shortly.

At the discretion of the lender, the Scheme may be used for unsecured lending for facilities of £250,000 and under.

Lenders were required to demonstrate lending additionality (i.e. lending that without the Scheme, wouldn’t have otherwise taken place). The Scheme has been extended to those businesses who would have previously met requirements for a commercial facility and would not have been eligible for CBILS.  As a result  it is suggested that all viable small businesses affected by Covid-19, and not just those unable to secure regular commercial financing, will now be eligible should they need finance to keep operating.

Primary Residential Property cannot be taken as Security under the Scheme. If the lender can offer finance on normal commercial terms without the need to make use of the Scheme, they will do so.

Yes, if they are paid via PAYE. This includes agency workers engaged under umbrella companies.

The furlough should be agreed between the agency (the employer) and the worker and documented in accordance with the guidance. It is recommended that the decision to furlough is discussed with end user clients. Just like other employees, agency workers cannot perform work through or on behalf of the agency while furloughed. This includes work for the client.

For agency staff working under umbrella companies, it is for the umbrella company and the agency worker to agree on furloughing the worker.

Yes. The system for Probate Applications has moved on-line and continues to be available as well as by post. However, if you need to complete an Inheritance Tax Return IHT400 you are likely to experience problems collating information due to delays in many organisations being able to provide you with current values while their offices are closed and staff working remotely. Property valuations will be particularly problematic where surveyors or valuers are unable to attend properties to undertake non-urgent work. If you cannot wait, you must use your best endeavours to be as accurate as possible as regards the information you provide in the IHT400 and follow up by providing HMRC with actual values as soon as you can do so. HM Courts and Tribunal Service is however warning that delays can be expected at this time.

A new employer may claim under the scheme in respect of the employees of a previous business transferred after 10 June 2020 as long as:

• the TUPE or PAYE business succession rules apply to the change in ownership
• the employees being claimed have previously had a claim submitted for them by their prior employer in relation to a furlough period of at least 3 consecutive weeks taking place any time between 1 March 2020 and 30 June

In these circumstances, the maximum number of employees that the new employer can claim for will be the total of both:

• the maximum number of employees the new employer claimed for in any one claim ending on or before 30 June
• the number of employees that are being transferred to the new employer which have had a claim submitted for them in relation to a furlough period of at least 3 consecutive weeks taking place any time between 1 March 2020 and 30 June. This is subject the maximum cap the previous employer was subject to.

A new employer is also eligible to claim under scheme in respect of the employees associated with a transfer of a business after 10 June 2020 from the liquidator of a company in compulsory liquidation where:

• TUPE would have applied were it not for the company being in compulsory liquidation
• the employees being claimed for have been furloughed and a had a claim submitted for them by their prior employer in relation to a period of at least 3 consecutive weeks taking place any time between 1 March 2020 and 30 June

In these circumstances, the maximum number of employees that the new employer can claim for will be the total of both:

• the maximum number of employees the new employer claimed for in any one claim ending on or before 30 June and
• the number of employees that are being transferred to the new employer which have had a claim submitted for them by their prior employer in relation to a furlough period of at least 3 consecutive weeks taking place any time between 1 March 2020 and 30 June. This is subject to the maximum cap the previous employer was subject to.