knowledge | 11 June 2020 |
COVID-19: Extension of Temporary Wage Subsidy Scheme and Redundancy Provisions
The Government has recently announced the following amendments to employment measures introduced to tackle the economic impact of the Covid-19 pandemic:
- Extension of timeline of Temporary Wage Subsidy Scheme
The Temporary Wage Subsidy Scheme commenced on 26 March 2020 and was originally expected to run for a period of 12 weeks. However, the Minister for Finance has announced that, as matters currently stand, the Scheme will remain in place until the end of August. He noted that the Government would continue to monitor the economic recovery as restrictions begin to be lifted and this will inform a decision later in the summer on the need for further extension or tapering beyond August.
- Widening of employee eligibility for the Scheme
Availing of the Scheme for specified employees, generally requires an employer to have made payroll returns in respect of those employees in February 2020. This caused some controversy as it precluded some employees who were availing of protected leave during that period. Employees can also now qualify for the Scheme if they were not on payroll on 29 February 2020 because they were on either:
(i) Maternity leave;
(ii) Adoptive leave;
(iii) Paternity leave;
(iv) Parental leave;
(v) Related unpaid leave; or
(vi) Receiving Health and Safety Benefit, Parent's Benefit or Illness Benefit for the month of February.
Payment will be backdated to 26 March 2020 or to the date the employee recommenced employment, whichever is the latest. Further details on how an employer can avail of the Scheme for such employees can be found at paragraph 3.15 of the latest Revenue Guidelines.
- Continued suspension of entitlement to claim redundancy arising from lay-off or short time
In March 2020, the Emergency Measures in the Public Interest (Covid-19) Act 2020 suspended the entitlement of employees to seek redundancy if they have been placed on lay-off or short time for a period exceeding four consecutive weeks or six weeks in any thirteen week period. This suspension was originally put in place until 31 May 2020 but this has been extended to 10 August 2020.
Further details on these measures (which were originally introduced by the Emergency Measures in the Public Interest (Covid-19) Act 2020) can be found in our briefing here.
How can we help?
The Employment, Pensions & Incentives Group are available to answer any queries you may have in relation to the supports available to employers in the current climate and can provide guidance on the legal consequences of measures being considered by your organisation to respond to the challenges posed by Covid-19. Our Tax Team is also available to assist with any queries you may have from a tax or social insurance perspective.
Also contributed by Emma Libreri
This briefing is for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.