Can someone please explain the 80 per cent salary cover

[noFlowers]

Sorry if I'm being stupid but what does this mean!

Does it mean businesses who may lay off staff get 80% of staff salaries to pay them so they can still work.

Or does it mean you lost your job due to all this and you're at home and you get 80% of your salary.

If it has to be reclaimed the company still has to have the money to pay it out in the first place.

This is the problem for a lot of small businesses. The portal will allegedly be set up by the end of April, how long the process will actually take from applying to receiving funds is totally unknown.

For many small businesses this is just not going to work and redundancies will be inevitable.

@Rutennotou I read that HMRC will be looking who was on the payroll at 28th February, to make sure the employees are legit.

Not fair at all for those in new jobs. I hope there will be a way around it.

Exactly userxx. Many of these businesses will have been shut down for 2 weeks already by end March. They can probably cover those salaries. But end April? A lot won't physically have that money. Will they be able to run payroll but defer the actual payment until govt cough up? It might be the only option many have

@StatisticallyChallenged We just don't know do we, totally winging it and I'm not happy advising clients on what to do.

I'm thinking they want employers to take out the business interruption loan to tide them over. More bloody debt! For the very small businesses, I'm thinking redundancies then rehire if and when the business starts trading again.

And that's if we can get the damn loans.

Does your employer still pay wages as normal and then reclaim from HMRC? My employer has told me I will be paid directly from HMRC so I’m worried that I won’t get paid at all now.

The details haven't been confirmed yet. Nobody really knows. My expectation is that they will do it via employers - so business will go to online portal, submit employee details, get grant, pay employees. Their is now talk of reimbursement which would make it technically pay employees first but the reality is many companies won't have the funds so it will be a case of waiting til they get the funds from govt

Individuals doing it would seem irrational as it would massively increase the admin associated with processing claims and making payments

DS had been working for an engineering company for a while, firstly via an agency then apparently they were taking him on. But they never got around to sorting the paperwork with HR dept.....

He was sent home yesterday so that's it. Nothing. He's trying to apply for UC and is currently in a queue of 132,000.

My employer said they had to submit payroll details and staff bank details to HMRC🤷🏻‍♀️.

Such confusing times😔

Still no proper details here but as I understand it, IF the company has to close as a direct result of COVID 19 then they pay the staff as usual, then submit their details to HMRC as a furloughed worker (still don't know how to say it!) and HMRC will refund 80% of salary (or £2500 whichever is the lesser amount). However they (HMRC) retain the 'right' to reject an application for furloughing but there is no information on why this may happen.

As I don't trust HMRC (or Government or insurance companies) an inch I assume that very many companies won't get this 80% and will end up paying staff for a couple of months before making them redundant anyway as they don't have any money left. In fact, our HR support company use the phrase "its just putting firms off making people redundant for a few months" which is very worrying.

I wish there was more information about it but i guess we have to be patient.

Unikitty, I believe yout employer is wrong. Everything I have read about the scheme is if the employer chooses to register for it the employer will be paid the 80% of your wages IF you are furloughed and have no work because of the virus and the employer can make up the other 20%. I have not read anywhere that HMRC would pay direct to employees as the PAYE system is not set up like that.

I suspect a lot of firms will be taking the approach of not actually paying until the money is flowing from HMRC. They often won't have a choice.

So worried😟. I hoping more information is giving soon.

I’m hoping*

Also I learned today that the supposedly helpful state backed new loans for businesses are being interpreted by many banks that they are allowed to ask the individuals who own the company to give security for the 100% of the loan - their houses and asses on the line - So much for that Government perk of a helpful loan - instead it is a massive elephant trap to be avoided.

Blimey Xenia. That is a huge deal.

I think a lot if what has been promised sounds good but in reality will be different

There is so much going on at the moment- these initiatives are proposed to help reassure people but a week later and no one is any cleaner how they are going to be delivered or processed and it's going to start mass panic soon when the money doesn't start flowing.

I know one person who works for a company that is still very much up and running well with government guidelines. She has decided to self isolate because she believes she will still be getting paid 80% of her wages so what's the point of going in.

The company my DH works for is still up and running but on skeleton staff. There are 15 of them in the building instead of 150+. Amongst those who are still at work about 6 of them are saying they're just not going to turn up next week and claim their 80%. Some feel their colleagues are very much on holiday whilst they're holding the business together.

We are at real risk of lulling people into a false sense of financial security. I know it's up to us as individuals to seek information and take responsibility for our finances but we know that's not how it works and some people aren't capable of interpreting information and analysing risks.

I know there are a lot of very worried people out there ourselves included but a lot of people think 3 months mortgage holiday + 80% wages.... I'm better off.

Not every company will seek the 80% grant if they can't cover the wages themselves. It might take months to process before any money can be paid with months of bills unpaid. Some companies may take the 80% for the three months then fold after with no jobs to go back to.

Some absolute clarity needs to be made in the next few days.

We are at real risk of lulling people into a false sense of financial security

Any sense of financial security that anyone has at this time is entirely false (apart from super-rich). A reckoning is just around the corner.

On Newsnight last night, one of the interviewees was an owner of a medical supply company, and was primarily there to talk about ventilators and the myths around the timescale of manufacture that the government has been putting out, but he said as an aside that there are issues getting the parts they need, as some companies are downing tools and taking the 80%.

If medical components companies, essential to support the response to this, are closing up for reasons other than risks to staff or staff absence, then that's certainly an unintended consequence of this rescue measures. Or maybe they did foresee it, and that's why they were a bit hesitant in bringing their package forward - they know that people will take advantage.

I guess they hoped that people will 'do the right thing'...

Same at my DHs company @BiarritzCrackers they have a good supply of orders coming through for a piece of scientific equipment that is extremely useful in this climate. Most of his colleagues want out so they can claim their 80% as most admin/ office staff have gone WFH. It's going to be a battle to keep people at work.

Most of his colleagues want out so they can claim their 80% as most admin/ office staff have gone WFH. It's going to be a battle to keep people at work.

The unintended consequences that will continue to bear rotten fruit, no doubt.

The furlough scheme is creating challenges for businesses who have small amounts of work. We're open this week to a small number of (keyworker) clients. Realistically we might have been able to continue this, but it's not enough work for everyone, we would need to furlough some. But we are struggling because people are looking for any excuse not to be one of the ones working. We've had folk refusing to come in, folk signing off sick, someone saying they wouldn't come to work because their dad said they should at. Half of the team suddenly have asthma...

We're going to close at the end of the week most likely unless we're asked by the council to step up the service, but I'm foreseeing real operational challenges if we are .

As far as I am aware - and as I have been told by my employer - it is THEM that has to do this. Not something I can claim. The company basically makes you redundant - hopefully temporarily - then you are paid in the usual way. Either 80% direct from HMRC or 80% from HMRC plus 20% from employer if they are a good one. Not sure about pension and nat insurance contributions. Maybe they go on hold? Waiting to hear details from my employer later today.

I'm trying to find out if it includes our commission/bonus (which we get for basically doing our job) otherwise it is a LOT less than 80% pay

Client, we don't know yet but I suspect it will be 80% of your base salary up to £2000 a month and only if the employer chooses to apply for it once the system is up and running at end of April (which I assume will be end of May as these projects are always late) so I suspect lots of employers will not be able to afford that scheme.

Statistically's point is a big issue for many companies - lots of people self isolating many on full pay or at least on sick pay from day 1 including a third of tube train drivers. I think those on SSP (who don't really need to be ) get £95 a week which for many is not enough to pay their rent but they might decide to ask for a rent holiday from the landlord but would still ultimately have to pay the missing rent, rather than go into work.