Today, the Chancellor Rishi Sunak announced a ‘Plan for Jobs’ to spur the UK’s recovery from the Coronavirus outbreak. The plan for jobs is the second part of a three-phase plan towards economic recovery and securing the UK’s long term prosperity.
Job Retention Bonus
As part of the plan to support jobs, a Job Retention Bonus (the Bonus) will be introduced to incentivise firms to keep on furloughed workers rather than making them redundant. UK employers will receive a one-off bonus of £1,000 for each furloughed employee who remains continuously employed through to the end of 31 January 2021. Payments will be made from February 2021.
For employers to get the Bonus, employees must be paid at least £520 on average in each month from November 2020 to the end of January 2021. Further details on the Bonus are expected to be announced by the end of July.
Potential penalties for employers
Less positive for employers is that they may face penalties for mistakes in claiming grants under the Coronavirus Job Retention Scheme (the Scheme). The Finance Bill, which is currently making its way through parliament, will allow HMRC to check grants made through the Scheme and impose financial penalties on employers who make incorrect claims and fail to report them within the prescribed self-reporting period (which has just been extended from 30 to 90 days). Legislation could be passed as early as this month.
We will continue to monitor the situation and provide further updates as they become available.
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