£ 1000 employer compensation

epm-84

Jaco70 said:

silvercar said:

Eligible for everyone who (a) you furloughed for at least 3 weeks (b) are still employed 31 January 2021 (c) average earnings of £520 Nov/ Dec/ Jan.
It may be worth giving your wife a pay rise from November!

Thanks for that. That sounds incredibly promising. To be honest I can't believe how generous it is, and it feels a bit unnecessary. Also, yes I should increase my wife's pay to £ 130 pw (she only works about half day per week btw, its not that I'm not a slave driver). I wonder if it covers directors, I shouldn't think so, but still great.
Thank you.

£100 for 1/2 day sounds like you are paying her £25 an hour or slightly more.  If your company isn't in a position to offer pay rises to all employees it may be fairer to increase her hours to be 2/3 of a working day per week and then she's earning more by working more hours opposed to being given a sneaky pay rise.

Although, note the Christmas/New Year period comes in to that so it may be she needs to work a day she doesn't normally work or book in annual leave around then to ensure she's earning over the LEL for the entire period.

Grumpy_chap

neilmcl said:

Daveinlincoln said:

So leading on from what the replies state here....am I also eligible? (hope you don't mind me jumping on your thread Jaco70)
I'm a limited company director, its just me in the company and I pay myself £700 a month, i'm getting £560 a month furlough pay at the moment.

Could I also get the £1000 in January?

Although the detail is yet to be published fully I'd doubt that it would apply to sole operated ltd companies and personally I don't think it should. It's an attempt to limit the amount of redundancies and you;re hardly in that position as a ltd co. director. 

We await the details to be published, but I think it will include owner director Ltd Co.  Same basis as they were eligible for furlough in the first place.

jimkelly

neilmcl said:

Daveinlincoln said:

So leading on from what the replies state here....am I also eligible? (hope you don't mind me jumping on your thread Jaco70)
I'm a limited company director, its just me in the company and I pay myself £700 a month, i'm getting £560 a month furlough pay at the moment.

Could I also get the £1000 in January?

Although the detail is yet to be published fully I'd doubt that it would apply to sole operated ltd companies and personally I don't think it should. It's an attempt to limit the amount of redundancies and you;re hardly in that position as a ltd co. director. 

The Chancellor has already said it will apply to all who were furloughed and in the HMRC employers email sent out last night, it said this:

Dear customer,

Today the Chancellor announced the introduction of the Job Retention Bonus.

This is a one-off payment of £1,000 to employers that have used the Coronavirus Job Retention Scheme (CJRS) for each furloughed employee who remains continuously employed until 31‌‌‌ ‌January 2021. The bonus will provide additional support to retain employees.

To be eligible, employees will need to:

• earn at least £520 per month (above the Lower Earnings Limit) on average for November, December and January
• have been furloughed by you at any point and legitimately claimed for under the Coronavirus Job Retention Scheme
• have been continuously employed by you up until at least 31‌‌‌ ‌January 2021.

Employers will be able to claim the bonus from February 2021 once accurate RTI data to 31‌‌‌ ‌January has been received. More information about this scheme will be available by 31‌‌‌ ‌July and full guidance will be published in the Autumn.

In any case, as seen previously on these boards with a [perceived] lack of support for small Ltd directors, I find it hard to justify how they (in your view) should be "excluded" - for want of a better word - whilst larger firms are somehow seen as more important.  You do know that Ltd directors actually pay tax as well?

Many of the excluded directors didn't bother with furlough in order to try to keep their companies afloat.  The CJRS Bonus is another kick in the teeth for them, because having not done so (furloughing themselves), they have inadvertently excluded themselves from this extra support.

Galloglass

Many of the excluded directors didn't bother with furlough in order to try to keep their companies afloat.  The CJRS Bonus is another kick in the teeth for them, because having not done so (furloughing themselves), they have inadvertently excluded themselves from this extra support.

It is a "retention" bonus. Are you threatening to sack yourself if you don't get £1K. 

When furlough runs out in October, an employer could keep staff employed for £521 per month - costs £563. So three months work for £500+.

If the same worker were to be laid off at the end of October, the cost to the government for UC would be £1,229.67 so by paying out the £1K they save £229.67 per person over the 3 months. 

Looks like a win, win for the Treasury

dunstonh

and a third is my wife who only draws £ 100 pw wages.

Is there a reason why you are not paying your wife to the primary threshold (or secondary threshold as you have employees)?

Although the detail is yet to be published fully I'd doubt that it would apply to sole operated ltd companies and personally I don't think it should. It's an attempt to limit the amount of redundancies and you;re hardly in that position as a ltd co. director. 

If the directors are on the monthly payroll then there is no reason why they should not be.   Annual payroll directors will almost certainly lose out again.

adamp87

I didn’t think it sounded good to be honest, surely if you are debating losing staff in most cases, it’s cheaper to do so and save the money from August/September to just get 1000 come January?

Appreciate situations aren’t different though 

Jaco70

sliphi said:

Jaco70 said:

jimkelly said:

Daveinlincoln said:

So leading on from what the replies state here....am I also eligible? (hope you don't mind me jumping on your thread Jaco70)
I'm a limited company director, its just me in the company and I pay myself £700 a month, i'm getting £560 a month furlough pay at the moment.

Could I also get the £1000 in January?

Yes as long as you are still paying yourself more then £520 per month between Nov - Jan.

Going back to the OP, as he seems to under the impression that he'll "only" get £1000.  If the 8 people furloughed are all still on the payroll for the 3 months up to the end of January (and they are all being paid a minimum of £520 per month for those 3 months), then the company will received 8 x £1000.

Whether they are a director or their wages are subsequently increased* (i.e. as your wife could be) is irrelevant.

* - unless the wording yet to be released restricts this in some way.

Yeah that's great. Potentially £ 7,000 as one employee left subsequently, but still a huge bonus for a small business. 

Yes, a little bonus for you come February, equivilent to a couple of weeks payroll bill, assuming you:
a) manage to generate the £85,000 between now and then to pay all your staff (plus whatever else you need to actually run your buisiness)
b) you increase your wife's pay by 30% (probably best not to let the other staff know of her pay rise for doing teh same job, else they will probably want to know where their's is, meaning your wage cost will increase to over £200k per year!)
c) All your current staff elect to remain with you (less the one who already left you once)
d) You don't have to let anyone go (less the one who already left you once, but if you now are forced to let that person go having only recently re-employed them, the morale of the other employees (less possibly your wife) will probably drop to rock bottom.

If you don't achieve all that, then the value of the bonus will be less.

* and assuming no devil is hidden in the detail when it is released later this month.

It's a scheme designed to now encourage employers to retain staff and so keep them off the dole queue, where presumably most would already be as they were generating no income for you at all very recently for 1-2 months.

Hope all goes well for your business that you will manage to get the bonus.

Yeah, all understood. Most of that seems achievable, with the unknown factor that people can leave at any time for any reason. I think morale is quite good here though, and I haven't had to let anyone go and the order book looks healthy. The one guy who left resented having to come off furlough, but my accountant was clear that if there's work to return to, and people wish to stay home, SSP is the correct route. As I was employing a sub-contractor some of the time to cover his work, I felt I was on shaky ground with HMRC. He felt that furlough should be the employees (i.e. his own) choice, so stalemate ensued. It was a horrible few weeks to be honest, and its a much happier camp now that he's gone. 

epm-84

dunstonh said:

and a third is my wife who only draws £ 100 pw wages.

Is there a reason why you are not paying your wife to the primary threshold (or secondary threshold as you have employees)?

He has already answered that - she only works 1/2 day per week, so £100 per week is equivalent to a very high hourly rate.

dunstonh

epm-84 said:

dunstonh said:

and a third is my wife who only draws £ 100 pw wages.

Is there a reason why you are not paying your wife to the primary threshold (or secondary threshold as you have employees)?

He has already answered that - she only works 1/2 day per week, so £100 per week is equivalent to a very high hourly rate.

But it is not far off the primary threshold and HMRC are not going to take any interest in a spouse earning the primary threshold.   By only paying that amount, she is not qualifying for a state pension.  

Jaco70

adamp87 said:

I didn’t think it sounded good to be honest, surely if you are debating losing staff in most cases, it’s cheaper to do so and save the money from August/September to just get 1000 come January?

Appreciate situations aren’t different though 

I agree, I don't think the £ 1,000 would encourage me to keep on staff if I didn't have work for them, but as I have no intention of laying people off (because we have a good order book), this feels like free money. I don't think I deserve it, but my principles aren't strong enough to turn down a free tickle.