Employers in Jersey will not have to pay remaining 20% wages

Businesses in Jersey will not have to pay the remaining 20% of employee's wages if they can prove they have taken an hit due to the coronavirus crisis.

The payroll co-funding scheme originally stated that employers would have to prove they had a drop in turnover of at least 30% in the month.

At today's briefing, Senator Lyndon Farnham, Jersey's Economic Minister said businesses that are experiencing "insufficient working capital or cash flow" will not be required to contribute to wages.

He said the Council of Ministers have agreed to enhance the Government Payroll Co-funding Scheme in phase two.

Employers

The phase two plan will see 80% of wages paid by government, up to a maximum of £1,600 per month for April, May and June for eligible sectors.

Employers will not be obliged to pay the remaining 20% of wages, and therefore can pass the value of the subsidy it receives directly to theemployee - up to a maximum of £1,600.

The government has asked that businesses try to keep employees in a job, even if that means being on reduced hours - rather than potentially facinglay-off or redundancy.

Senator Farnham said: "Employers will still be required under the employment law to agree all changes to employment contracts with their staff in the normal way."

• Jersey wage subsidy scheme to be changed to help businesses avoid collapse

Senator Farnham said: "Employers in Jersey, like the UK, will now be able, in specific circumstances, to be reimbursed for up to 80% of employee wages from the government.

However, unlike the UK Furlough scheme, that employer can still utilise the employee for work over this time. This contributes to positive activity in the economy and helps islanders continue to work."

• Minority of Jersey businesses can now claim wage subsidy

• Government to subsidise the wages of half of Jersey’s workforce

Self-employed

Amendments to the phase two plan include those who are self-employed and affected by Covid-19 business disruption. They will receive a payment of 80% of their average monthly income.

This will be up to a total of £1,600 per month for April, May and June.

The average will be taken from their 2019 figures.

Today Senator Farnham made it clear that the scheme can be reviewed for extension if disruption continues after June 2020.

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