Overview
Employers can ask their employees to stay at home or take unpaid leave if there’s not enough work. This is classed as either:
There is no limit to how long employees can be laid off or put on short-time hours but employees could apply for redundancy and claim redundancy pay if it’s been:
Employees should receive full pay unless their contract allows unpaid or reduced pay lay-offs. If a contract states that employees will be unpaid, they are entitled to Statutory Guarantee Pay.
Guarantee pay is a legislative requirement. Non-payment will count as an unlawful deduction from wages and may result in an employment tribunal.
https://www.gov.uk/lay-offs-short-timeworking
For additional knowledge articles relating the the Covid-19 epidemic, please visit - Fourth Products and Covid-19
Statutory Guarantee Pay
Employees who are unpaid during lay-off or short-time working are entitled to Statutory Guarantee Pay.
To be eligible to receive Statutory Guarantee Pay, employees must:
If eligible, employees are entitled to:
Statutory Guarantee Pay cannot be claimed for any day that the employee has carried out some work.
Paying Guarantee Pay
When paying Guarantee Pay via HR & Payroll, a new Payment Type should be created to use for payments made to employees. The payment of Guarantee Pay is subject to normal tax and National Insurance contributions.
Under current guidelines it is not possible to reclaim Statutory Guarantee Pay back from HMRC.
Employers can ask their employees to stay at home or take unpaid leave if there’s not enough work. This is classed as either:
- A Lay-off – if employees are off for at least 1 working day
- Short-time working – when hours are cut
There is no limit to how long employees can be laid off or put on short-time hours but employees could apply for redundancy and claim redundancy pay if it’s been:
- 4 weeks in a row
- 6 weeks in a 13 week period
Employees should receive full pay unless their contract allows unpaid or reduced pay lay-offs. If a contract states that employees will be unpaid, they are entitled to Statutory Guarantee Pay.
Guarantee pay is a legislative requirement. Non-payment will count as an unlawful deduction from wages and may result in an employment tribunal.
https://www.gov.uk/lay-offs-short-timeworking
For additional knowledge articles relating the the Covid-19 epidemic, please visit - Fourth Products and Covid-19
Statutory Guarantee Pay
Employees who are unpaid during lay-off or short-time working are entitled to Statutory Guarantee Pay.
To be eligible to receive Statutory Guarantee Pay, employees must:
- Have been employed continuously for 1 month
- Reasonably make sure they are available for work
- Not refuse any reasonable alternative work (including work not in the contract)
- Not have been laid off because of industrial action
- Not already be receiving pay for lay-off or short-time from the employer
If eligible, employees are entitled to:
- Up to £29* per day
- Normal daily rate if below £29*
- A maximum of 5 days’ pay in any 3 month period
Statutory Guarantee Pay cannot be claimed for any day that the employee has carried out some work.
Paying Guarantee Pay
When paying Guarantee Pay via HR & Payroll, a new Payment Type should be created to use for payments made to employees. The payment of Guarantee Pay is subject to normal tax and National Insurance contributions.
Under current guidelines it is not possible to reclaim Statutory Guarantee Pay back from HMRC.
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