Insights overview

Key Employment Law implications of the Budget 2020

Today’s budget was very much focussed on alleviating the immediate impacts of Coronavirus and contained some useful measures for employers dealing with the impact of the outbreak:

Statutory sick pay will be available to individuals self-isolating and will be available from day 1 of the absence.
Sick notes will be available by contacting NHS 111, rather than having to attend a doctor’s surgery or hospital.
Companies with fewer than 250 employees will receive rebates on statutory sick pay paid to staff, worth a total of £2bn for up to 2m small businesses
The Chancellor acknowledged that millions of self-employed workers or those working in the gig economy will also need help. The government will make it quicker and easier to access benefits, but there was no proposal to provide statutory sick pay to the self-employed at this stage.

These measures bring welcome clarification and will ensure employees who have to spend time off sick are still paid but it leaves the self-employed exposed. In addition, if the government decides to close schools and nurseries, there is no guidance or support for employers on how to approach payment of staff who need to remain home to look after their children – employees will be left falling back on emergency time off for dependants or parental leave, both of which are unpaid unless the employer opts for payment.

From an immigration perspective, there was less welcome news in the announcement to increase the Immigration Health Surcharge for non-EEA migrants from £400 per year to £624 per year. There will, however, be a lower increase for children (new rate of £470 per year). These measures are likely to take effect from October 2020.

In addition, the government confirmed that it will proceed to implement the Off Payroll Working Rules on the use of contractors via personal services companies, with effect from 6 April 2020 (some commentators had somewhat optimistically hoped that the implementation date might be pushed back, given the impact of Coronavirus).