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Markel Insurance

02 Apr 2020

COVID-19: How the Government is helping furlough workers

In response to COVID-19 (Coronavirus) and to safeguard the livelihood of business across the UK, the Government has introduced emergency measures for workers to support them through the pandemic.  These measures will cover the wages of millions as a result. 

On Friday 20 March, the Chancellor of the Exchequer, Rishi Sunak announced that the Government will cover 80% of those who have been furloughed by setting up a new COVID-19 Job Retention Scheme.

The announcement was broadly welcomed by unions and businesses as it will enable UK employers to access a grant to continue paying part of the salary of employees who would otherwise have lost their job or made redundant as a result of the COVID-19 crisis.

What does furlough mean and how does it affect UK businesses?

Furlough refers to an employee whose boss has required them to take an unpaid leave of absence from their job.  In light of COVID-19 many employees have found themselves in this situation – especially those who work in the hospitality industry. 

The doors have shut in pubs, cafes and restaurants across the UK and many other industries such as care and tech businesses have also been forced into changing the way they operate and adapt new processes through social distancing. 

The Government’s response

The Government announced plans to assist those impacted though the Job Retention Scheme.  This allows employers to place employers on furlough – as consequence they will still be employed by them despite them not working.
Employers will also receive financial assistance to ensure employees are being paid. The Government will cover 80% of furloughed employee wages, up to a maximum of £2,500 per month.

The scheme will cover wages from 1 March and will initially be in place for three months. However, on 24 March the Chancellor of the Exchequer said in the House that the scheme may not be rolled out until the end of April.

Self-employed-income-support-scheme-flowchart.pngJob-retention-scheme-eligibility-flowchart-(1).png





 

Useful resources

To see more COVID-19 related content and how Markel UK are assisting our policyholder and brokers, visit the COVID-19 Hub.

Our COVID-19 Hub contains a range of information and resources to best support our clients during this difficult time. To receive the latest news and insights by email sign-up here.

Markel brokers and policyholders also have access to our Law hub, providing thousands of DIY contracts, forms guides and links to valuable resources for businesses needing assistance with the everyday running of their organisations.

Tagged SME Insurance products COVID-19
Next article in series

02 Apr 2020

COVID-19: Construction - between a rock and a hard place