Update: Coronavirus government support for agriculture and rural businesses
The Coronavirus pandemic has led to a raft of new schemes and legislation to support individuals and businesses through a challenging period.
Last week we explained the relevance of the Coronavirus Business Interruption Scheme and the Coronavirus Job Retention Scheme to farming businesses. However, the pandemic and the measures being put in place by the government are both ever-changing beasts, so here is an update.
Support for the self-employed
As promised, Rishi Sunak revealed the government’s eagerly anticipated Self-Employed Income Support Scheme last Thursday. He claims that this will cover 95% of the self-employed. It is likely that many farmers and contractors will fall under this category.
Prior to this announcement, the only support for the self-employed was Employment and Support Allowance (ESA) instead of Statutory Sick Pay. This is paid to those who are too sick to work or who are self-isolating and equates to £73.10 per week or £57.90 per week for under-25s. The government have removed the minimum income floor temporarily and had made the application process telephone based rather than in person.
The newly announced Self-Employed Income Support Scheme does not cover everyone in the same way that the Coronavirus Job Retention Scheme does. In order to be eligible, you must;
-Earn more than half your income from being self employed
-Have had a trading profit of less than £50,000 for 2018/19 OR had a trading profit of less than £50,000 for the tax years 2016/17, 2017/18 and 2018/19
If you are eligible, you will receive the same support as those who are employed; 80% of your monthly profits up to £2500 a month. Unlike the Coronavirus Job Retention Scheme, this will be paid in a lump sum in June.
Agricultural Minimum Wage
When we discussed the Coronavirus Job Retention Scheme last week, we highlighted that this had to remain in-line with an employee’s existing contract and employment law.
Another area to highlight to farming businesses is the Agricultural Minimum Wage. This becomes relevant when an employee is self-isolating because they or a member of their household has shown symptoms of Coronavirus.
For most employees, they are entitled to Statutory Sick Pay (SSP) for the 7 or 14 days of isolation, with the government announcing early on in the pandemic that employees wouldn’t have to go unpaid for the first 3 ‘waiting days’, instead receiving SSP from their first day off work.
This is paid by the employer who, provided the employee is self-isolating for COVID-19, is then reimbursed by government and currently equates to £94.25 per week (which will change to £95.85 p/week on 6th April).
However, if an agricultural worker was employed before the changes on 1st October 2013, they are contractually entitled to Agricultural Minimum Wage, which is significantly more than SSP.
Employers of agricultural workers will be able to reclaim the £94.25 SSP from the government but will need to top up these employees’ wages to ensure they meet the Agricultural Minimum Wage as per their contract.