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Mini-Budget 2020: Employment Announcements

The Chancellor Rishi Sunak has today announced a package of measures intended to “protect, support and create jobs” and kickstart the economy.

Jobs retention bonuses

Businesses that take back furloughed workers and keep them employed until the end of January 2021 will receive a £1000 “jobs retention bonus” per employee.  The Chancellor said that it is vital that people are not just returning for the sake of it, and that they need to be doing decent work.

To be eligible for the bonus, the employee must be paid at least £520 on average per month from November to January (the equivalent of the lower earnings limit for National Insurance) and must be continuously employed through to the end of January 2021.  This will apply to all furloughed employees.

Kickstart scheme

A new “kickstart scheme” has been unveiled which will create government-subsidised jobs for unemployed young people.  The Government will directly pay employers to create new jobs for 16 to 24-year olds at risk of long-term unemployment.  These will be new jobs with the funding being conditional on the business showing that the jobs are “additional” and “decent” – i.e. they must be for a minimum of 25 hours per week payable at the National Minimum Wage rate or above.  The scheme is designed so that employers provide “kickstarters” with training and support to find a permanent job.

The Chancellor pledged that the Government will pay those wages for 6 months plus overheads.  Employers can apply to the scheme from next month with the first kickstarters in work from Autumn.

Traineeships and apprenticeships

Businesses will be given £1,000 for each traineeship they offer.  The Government will also pay employers to create new apprenticeships for the next 6 months.  The rate will be £2,000 per apprentice recruited under the age of 25 and £1,500 per apprentice aged 25 and over.

Coronavirus Job Retention Scheme

Whilst some have called for the Coronavirus Job Retention Scheme to be extended past October, the Chancellor confirmed that it cannot and should not run on indefinitely.  It will wind down “flexibly and gradually” and end in October.

If you require any assistance in relation to any employment or HR matters generally please do not hesitate to contact Joanne Holborn, Tom Scaife or Caroline Rayner on 01228 552600 or 01524 548494.

This alert does not provide a full statement of the law and readers are advised to take legal advice before taking any action based on the information contained herein.

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