Measures announced in the Budget today will make it easier for workers’ to self-isolate if they suspect they have the coronavirus, commentators have said, but many workers and employers will still face significant financial pressure.
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As the number of confirmed covid-19 cases rose to 456, chancellor of the exchequer Rishi Sunak confirmed that eligible employees will be entitled to statutory sick pay (SSP) from their first day of sick leave instead of the fourth, whether they are unwell or whether they are self-isolating on suspicion they have the coronavirus. They will also be able to obtain a sick note through the NHS 111 helpline, rather than in person from their GP.
However, while the measures will provide temporary financial relief for some, many workers – including those who are self-employed and do not qualify for SSP – will still face financial hardship, according to experts, as SSP is paid at just £94.25 a week.
Practically, the changes will make managing self-isolation and sickness absence easier for all employers as employees will be able to obtain a certificate from NHS 111 confirming that they must self-isolate,” – Stephen Ratcliffe, Baker McKenzie
“Let’s not forget the financial challenges that self-isolation can pose to workers,” said John Ellmore, director from financial advice service Know Your Money. “It is estimated there are two million people in the UK with no sick pay who may not be able to afford two weeks of self-isolation.
“Should the coronavirus outbreak worsen, just how much assistance can the government realistically provide to help businesses and their employees?”
Self-employed people will be able to access benefits from day one of their sickness or self-isolation, rather than day eight, but will not receive SSP.
The government will cover the cost of SSP for employers with less than 250 staff for up to 14 days of an employees’ coronavirus-related absence.
Stephen Ratcliffe, an employment lawyer at Baker McKenzie, said: “Practically, the changes will make managing self-isolation and sickness absence easier for all employers as employees will be able to obtain a certificate from NHS 111 confirming that they must self-isolate.
“The financial support for small businesses is welcome, but for employees, statutory sick pay will be a fraction of many people’s usual wage so employees will still be under financial pressures. The government has previously said that it is good practice, to pay over and above statutory sick pay rates if that is the employer’s usual policy.”
Tom Hadley, director of policy at the Recruitment and Employment Confederation, was critical that the support did not extend to larger employers.
“There appears to be little support for business of over 250 employees – this is likely to include temporary workers on the books of recruitment agencies,” he said.
He was also disappointed that the Budget focused on exceptional, short-term measures, rather than longer-term business challenges like Brexit skills shortages.
“Before coronavirus, industries like healthcare, hospitality and logistics were facing damaging skills shortages. Shortages among medical staff will test the NHS as the country battles Covid-19. Businesses need a long-term plan that focuses on building skills,” said Hadley.
“The government should transform the Apprenticeship Levy so it can support training for temporary workers our economy relies on. Businesses need a negotiated exit from the EU and an immigration policy that addresses skills shortages at all pay and skill levels.”
Steve Wainwright, managing director EMEA at L&D firm Skillsoft, also expressed disappointment that skills development had not been a central pillar of the Budget, as former chancellor Sajid Javid had indicated before the coronavirus outbreak had become so widespread.
Before coronavirus, industries like healthcare, hospitality and logistics were facing damaging skills shortages. Shortages among medical staff will test the NHS as the country battles Covid-19. Businesses need a long-term plan that focuses on building skills,” – Tom Hadley, Recruitment and Employment Confederation
He said: “One of the most significant challenges facing companies today is preparing their talent base for the shift to digital. And as digital transformation becomes a reality, organisations must equip their employees with the skills they need to deliver in this ‘new normal’ economy. Reskilling employees to better understand and leverage new technologies, processes and ways of thinking could very well mean the difference between success and failure.”
The chancellor also confirmed that changes to IR35 rules in the private sector would go ahead, despite widespread concern and resistance from contractors and organisations that use them.
Richard Mort, a director at software testing firm Edge Testing Solutions, commented: “Hopefully after today, uncertainty within the market will reduce, from both clients and contractors. For contractors, frustration, confusion, and uncertainty seem to be overriding reactions.”
He said IR35 will bring opportunities for companies to develop more talent in-house, adding that “the most important aspect of approaching the IR35 reform correctly is for organisations to be clear about the determination of roles moving forward and act accordingly, without looking for any loopholes.”
Businesses must now act quickly to avoid falling foul of the law when the changes take effect on 6 April, suggested Nicole Forbes, deputy general counsel at international expansion advisory firm Globalization Partners.
“It is imperative to act quickly and proactively to reduce the risk of non-compliance before rule changes take effect,” she said. “Companies should be evaluating contractor relationships in order to make a choice; changing the scope of work so IR35 rules do not apply, hiring the contractor as an employee, or eliminating the relationship.”