COVID-19: What Government support is available to help you through the Coronavirus outbreak and what else do you need to know? BLM’s Commercial Advisory & Private Wealth Practice explains

BLM’s Commercial Advisory & Private Wealth Team is committed to remaining clear, concise and connected – supporting our clients and our team during the on-going uncertainty around the spread of COVID-19. With a wide range of robust and stress-tested contingency plans in place to ensure continuity of our business and minimise any disruption to our work, we’re continuing to follow Government guidelines on a daily basis and adjust our response to the evolving situation. The firm as a whole and each of our offices are very much open for business but we’re also working remotely wherever possible, and supporting our clients to do the same.

As part of our on-going commitment to do our utmost to support our clients through these unprecedented times, set out below is a summary of the key business support and other critical measures announced by the Government at the end of last week.

We will continue to update this list regularly as and when changes are announced, and make other content available to address specific business-critical legal issues as soon as we can:

Social Distancing

Public Health England has issued new Social Distancing Guidance, available here.

Anyone at increased risk of severe illness from COVID-19 must observe stringent social distancing for a period of three months, and will already have been notified via SMS text messaging.

Everyone must take the following measures as soon as possible:

  • Avoid contact with anyone displaying Coronavirus symptoms, including a high temperature and/or a new and continuous cough
  • Avoid any non-essential use of public transport wherever possible
  • Work from home, wherever possible
  • Avoid gatherings in public spaces
  • Avoid gatherings with friends and family, and keep in touch remotely by phone, internet and social media
  • Use telephone or online services to contact your GP or other essential services
  • Wash your hands as often as possible for at least 20 seconds using soap and water or hand sanitiser – as a minimum when arriving home or at work, when you blow your nose, sneeze, cough, eating or handling food
  • Avoid touching your eyes, nose or mouth with unwashed hands
  • Cover any cough or sneeze with a tissue, then throw the tissue into a bin and wash your hands
  • Regularly clean and disinfect frequently-touched objects and surfaces in homes
  • Self-isolate at home if you develop symptoms, for a period of either 7 or 14 days dependent upon your family situation
  • Use online services wherever possible to obtain food and medicines or ask family, friends or neighbours to support you where possible
  • Do not visit family or friends unless to provide essential care (including help with washing, dressing or preparing meals), and then only when taking extra precautions

Coronavirus Job Retention Scheme – what is it and how do I access it? And what are ‘furloughed’ workers/employees?

  • Every UK employer can now access financial support through grants to enable them to continue to pay their employees’ salaries who would otherwise have found themselves laid off as a result of the impact of COVID-19, up to a maximum limit of 80% of salary costs to a maximum cap of £2500 per month.  The intention appears to be that the £2,500 will be a net payment, but confirmation on this point is required from HMRC.
  • The scheme will apply in respect of all employees on PAYE, including those on zero-hours contracts. It will therefore cover workers as well as employees.
  • Employers should act now to get Furlough agreements in place, and ideally signed ready for the opening of the HMRC portal. We now have standard Furlough agreements available.
  • Businesses will need to engage with both their employees/workers and HMRC to be able to take advantage of this scheme.
  • Any affected employees/workers will need to be designated as being “furloughed”, and notified of that change
  • General employment law rules continue to apply – changing the status of any furloughed employee will be a change to the terms and conditions of their employment, which may need to be negotiated and which ideally need to be recorded in writing to be effective – starting those discussions now is about the best thing you can do whilst we wait for further clarity as to how the scheme will work in practice. In the present circumstances, we think that a letter stating that individuals will be treated as furloughed unless they object is sufficient.
  • Once furloughed, employees won’t be able to work for their employer or for anyone else.
  • Businesses can choose to fund any difference between the 80% grant and full salary at their own discretion and without any requirement as part of the scheme
  • HMRC are working urgently to set up an online portal to allow employers to submit details of the earnings of “furloughed” employees/workers, and we’ll provide a link and further detail of any other information required once it’s available
  • HMRC’s existing systems don’t allow for payments to employers, and a new reimbursement system will be announced very shortly
  • Whilst this support will be very welcome for businesses up and down the UK, many gaps on how it will work still need to be filled in – we don’t yet know what the detailed position is going to be in relation to National Insurance and Income Tax or HMRC’s requirements for employers to take advantage of the scheme.
  • It would appear that employers can choose whether to place employees on furlough leave, or make them redundant.  Employees do not have a right to require their employer to place them on furlough leave as an alternative to redundancy.  It is hoped that many employers will see the new scheme as preferable to business closure and making redundancies.

Statutory Sick Pay – SSP – what is the current position as a result of COVID-19/Coronavirus?

The Department for Business, Energy and Industrial Strategy and Public Health England has published new Guidance For Employers and Businesses On Coronavirus, available here

  • Employers should communicate regularly with their staff on action being taken to reduce their risk of Coronavirus exposure, and ensure contact and emergency information is kept up to date
  • Managers should look out for any symptoms of Coronavirus and be clear on sickness reporting and SSP provision to allow them to take appropriate action
  • Businesses and workplaces should encourage their staff to work at home wherever possible
  • Anyone within the workplace exhibiting Coronavirus symptoms should be sent home immediately and advised to follow the advice to stay at home
  • Employees should be reminded to wash their hands more frequently and for at least 20 seconds, as well as catching coughs and sneezes in tissues
  • Any object or surface which is touched frequently should be disinfected regularly
  • Employers should support their staff in working from home and employees from defined vulnerable groups should be strongly advised and supported to stay at home and work from there if possible or to follow social distancing guidance
  • Legislation is being brought forward to allow small-to-medium-sized businesses and employers to reclaim statutory sick pay (SSP) which they have paid in relation to any absence as a result of the COVID-19 outbreak, from the day after the new regulations come into force
  • The refund will cover up to 2 weeks’ SSP per eligible employee in businesses with fewer than 250 employees as of 28 February 2020
  • Employers will need to maintain records of absence and SSP paid, but employees will not need to provide a Fit Note from their GP – if employers need supporting medical evidence, then Isolation Notes can be obtained through NHS 111 Online or notes for anyone living with someone with symptoms are available through the NHS Website
  • HMRC will put a new repayment portal in place for Employers as soon as possible

Retail, Leisure & Hospitality – available business rates’  holidays & cash grants due to COVID-19/Coronavirus

  • Businesses in the retail, leisure and hospitality sector with properties being wholly or mainly used as shops, cafes, venues or assembly and leisure with a rateable value of less than £51,000 will be able to take advantage of a Business Rates Holiday for the 2020 to 2021 Tax Year, and any business which received a retail discount in the 2019 to 2020 Tax Year will be rebilled by their Local Authority as soon as possible
  • No action needs to be taken to access the scheme, which will apply to any eligible Business’ next Council Tax Bill in April 2020
  • The Business Rates Calculator will allow you to estimate your Business Rate savings over the coming year
  • Any retail, leisure and hospitality business based in the UK with an eligible property (see above) will be able to claim a cash grant from their Local Authority of up to £25,000 per site – properties with a rateable value below £15,000 will receive £10,000 and between £15,001 and £51,000 will receive £25,000
  • No action needs to be taken to access these grants; local authorities will notify eligible businesses and provide further details on the operation of this scheme shortly

Commercial Property – Rent Payments & Protection From Evictions

A Press Release from the Ministry Of Housing, Communities & Local Government, the Department For Business, Energy & Industrial Strategy and the HM Treasury dated 23 March 2020 has confirmed that:

  • Any commercial tenant unable to pay rent as a result of the Coronavirus outbreak will be protected from eviction for the next three months from 23 March
  • Many Landlords and Tenants are already, and should be, in touch to discuss voluntary agreements for rent payments
  • Commercial Tenants will remain liable for rent after this three-month period, and the Government is in touch with Landlords as to how they can support them

Small Business Grant Scheme in light of COVID-19/Coronavirus

  • Any business based in England which occupies property and is entitled to Small Business Rate Relief or Rural Rate Relief will be able to access a one-off grant of £10,000 to meet ongoing business costs
  • No action needs to be taken to access these grants; local authorities will notify eligible businesses and provide further details on the operation of this scheme shortly

  VAT & income tax payment deferrals in light of COVID-19/Coronavirus

  • Any VAT payment due over the next 3 months will be able to be deferred until the end of the current tax year
  • Income Tax Payments due for anyone self-employed will be deferred until January 2021
  • Neither of these schemes involve any application process or other conditions – VATR refunds and reclaims will continue to be paid as normal
  • Additionally, any business or employer in financial distress which has an outstanding tax liability may be eligible for further time to pay, assessed on a case by case basis – HMRC’s dedicated helpline number is 0800 0159 559

Coronavirus Business Interruption Loan Scheme

  • Regardless of sector, any business with a turnover of up to £45 million with a viable borrowing proposal (i.e. once which would be viable if the COVID-19 outbreak had not taken place) can apply for the Coronavirus Business Interruption Loan Scheme via one of over 40 Lenders accredited by the British Business Bank, ranging from traditional bans to specialist providers
  • Businesses should approach their own providers first, and eligibility for the scheme is delegated to the accredited lenders – if finance can be offered on normal commercial terms without making use of the scheme, it will be
  • High demand is expected, so applications via a Lender’s website are preferred over the telephone or face-to-face enquiries (capacity for which will be limited given social distancing rules)
  • Businesses should give thought as to whether or not their need is for regular long-term finance rather than emergency financial support
  • Available facilities will include term loans, overdrafts, and asset and invoice finance, dependent upon the lender
  • Any guarantee under this scheme is to the lender and not the business; Borrowers remain 100% liable for repayments
  • Further information is available from British Business Bank

Insurance in light of COVID-19/Coronavirus

  • Any business with cover for pandemics or government-ordered closure should be covered provided that all other policy terms and conditions are met, notably in the Retail, Leisure and Hospitality Sector as a result of the Government’s announcement on 17 March 2020
  • However, coverage differs from policy to policy, and businesses should be checking their terms and contacting providers now to confirm the limits of their cover
  • Unfortunately, most businesses are unlikely to be covered, as standard business interruption policies tend to be dependent upon damage to property and will usually exclude pandemics from their terms

Courts & Tribunals – Civil & Family Cases in light of COVID-19/Coronavirus 

  • HM Courts & Tribunals Service and the Ministry Of Justice are working to minimise risk to their staff and users of their services, meaning that arrangements are being put in place to use telephone, video or other technology to continue as many hearings as possible remotely – any physical hearings will follow social distancing guidance
  • All new jury trials in the Crown Court have been paused temporarily, and most small claims, fast track and multi-track cases listed for April 2020 will be vacated
  • Any changes to individual hearings will be notified to claimants or defendants by e-mail or telephone
  • In cases where parties to a case or their advisers are self-isolating in line with NHS advice, are confirmed or suspected of having COVID-19 or have related childcare responsibilities, fees for applications to adjourn civil or family hearings may be waived on provision of medical and other evidence, provided that the hearing could not be conducted remotely – HMCTS also suggests that parties “use the available time to explore the possibility for compromise before agreeing to requesting to adjourn”, and any adjournment should be applied for as soon as possible otherwise
  • Each court will be producing its own guidance in due court, and we’ll update you when it becomes available

Whatever challenges our clients and our teams may face over the coming weeks and months, BLM’s Commercial Advisory and Private Wealth team will adapt and do our utmost to help you meet them, and although we may not be able to reassure you in person or engage with you as usual, we’re always available by e-mail, telephone or video.

In the meantime, our thoughts are with you and your families.