IR35 workers with ongoing contracts can now benefit from the 80% furlough rules, Cabinet Office reveals
Contractors working for public sector organisations through personal service companies who are unable to carry on working due to the covid-19 pandemic will now be eligible for the 80% furlough scheme if their contracts are ongoing, the Cabinet Office has announced.
Nurses and doctors working as locums across the NHS, and IT contractors working on strategic IT projects, for example, will now be able to access financial support. However, there are still no signs that the Coronavirus Job Retention Scheme (CJRS) will be extended to private sector off-payroll workers.
In its guidance, the Cabinet Office says the measures aim to protect:
- the livelihood of contingent workers, avoiding claims of unnecessary Statutory Sick Pay from the supply chain;
- against the risk that some may attend work when they should be self-isolating, thereby potentially infecting wider teams and the broader general public;
- against the risk of losing critical workers to jobs in other sectors because they are not getting paid;
- supplier revenue with the intention of keeping them solvent so they remain a part of our ongoing supply chain in the future.
The guidance will apply to all categories of public sector contingent workers, including those covered by PAYE, umbrella companies and personal services companies. However, any contingent worker who can continue to work from home should do so and should continue to be paid in the usual way. Any contingent workers who are working in this way but are also dealing with childcare should be afforded the same flexibility as permanent staff.
If contingent workers are unable to work due to covid-19, for example due to sickness, self-isolation, or the temporary closure of offices, they should be paid at 80% of their pay rate up to a maximum of £2,500 per month. This should be backdated to 1 March 2020 if necessary, and will be available initially for at least 3 months.
If contingent workers are unable to work due to childcare responsibilities now that schools have closed, they should continue to be paid on the same basis for up to seven working days while they make alternative arrangements.
The Cabinet Office briefing sets out more detail in its Guidance notes on Payments to Suppliers for Contingent Workers impacted by Covid-19