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Amy White

Partner - Uckfield

17th July 2020

Summer Statement: Employment Updates

On Wednesday, 8 July 2020, Chancellor Rishi Sunak announced his Summer Statement (or ‘mini budget’) in Parliament in order to assist the UK’s recovery from the Coronavirus pandemic.

This article focuses on the employment aspects of the Summer Statement.

Job Retention Bonus

As part of the Chancellor’s plan to support employment, UK employers will be entitled to receive a one-off bonus of £1,000 for each furloughed employee who remains continuously employed up to and including 31 January 2021.

Whilst there is currently very little information available in connection with the proposed bonus scheme, we do know that in order to be eligible, employees must have earned above the Lower Earnings Limit (£520 per month) on average between the end of the Coronavirus Job Retention Scheme (31 October 2020) and the end of January 2021.

In accordance with A Plan for Jobs 2020, more detail is expected to be available at the end of July 2020.

The Kickstart Scheme

The Government has announced that it will introduce a £2 billion ‘kickstart’ scheme to assist UK employers in recruiting young people at risk of long term unemployment into high quality jobs. The scheme will consist of six month long work placements aimed at those aged between 16 and 24 who are currently claiming Universal Credit.

The funding available for these placements will cover:

  • 100% of the relevant National Minimum Wage for 25 hours a week;
  • Employer National Insurance contributions; and
  • Employer minimum automatic enrolment contributions.

Apprenticeship Support

Alongside the kickstart scheme, the Government has announced a £111 million trainee incentive scheme in England, to fund high quality work placements and training for those aged between 16 and 24.

In short, the Government will pay £1,000 to employers who provide trainees with work experience, ranging from traineeships up to and including Level 3 qualifications, to ensure that more young people have access to high quality training.

Additionally, the Government will pay employers in England the following amounts if they hire an apprentice between 1 August 2020 and 31 January 2021:

  • £2,000 for each new apprentice hired under the age of 25; and
  • £1,500 for each new apprentice hired aged 25 and over.

For more information on employment law issues, the impact of Covid-19 and the Summer Statement update, contact Victoria Regan or Amy White in Rix & Kay’s Employment Team.

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