Guidance for UK Contractors engaged via Gattaca

This page has a round-up of some of the schemes and assistance the government has released so far, as well as Gattaca’s position. If you are working via an Umbrella company, please contact your provider for advice. We will continually monitor Government advice and update the information accordingly.

 

Gattaca’s position on the PAYE Job Retention Scheme

Gattaca welcomes the Government’s initiatives to support the contingent UK labour force, who are critical Gattaca stakeholders, and look forward to supporting our contractors.  
 
It is Gattaca’s intention to claim furlough payments for any PAYE temporary workers who qualify against the detailed rules, once published by the Government, and whose assignment with our end-client has been cancelled or suspended as a result of COVID-19. 
 
Please note: the Government announced an update to the Coronavirus Job Retention Scheme on Friday 29 May 2020. Gattaca are in the process of reviewing these changes and will update our PAYE contractors in due course. 

UK Contractor FAQs

 

What is the Government’s Job Retention Scheme?

The Government has announced a Coronavirus Job Retention Scheme, whereby employers can furlough employees as an alternative to making them redundant due to COVID-19 and claim a Government grant for 80% of the employee’s pay, up to a maximum of £2,500 gross per month per employee.  The employer must then pay this sum (less PAYE tax and National Insurance) to the furloughed employee.  Employees do not have a right to be furloughed.  It is a commercial decision for employers as to whether to operate the scheme for their workforce. 

Further guidance on the scheme is still being released, but the Government has already released the following details:

  • The employee must be furloughed for at least 3 weeks 
  • The employee cannot carry out any work for the employer while furloughed
  • The employee must have been on the employer’s payroll on or before 19 March 2020
  • The employer can pay the employee more than the amount received from the Government, but is not obliged to.
  • The scheme will be open until at least the end of June 2020.

If you work via a limited company and are a company director, you will be responsible for the decision to furlough yourself and for following the appropriate process to claim the grant, which will be paid directly to your Ltd company.

Further details of the Scheme are set out on the Government’s website: 

https://www.gov.uk/guidance/check-if-you-could-be-covered-by-the-coronavirus-job-retention-scheme

 

I am a PAYE contractor via Gattaca, am I eligible to be furloughed under the Job Retention Scheme?

Potentially, provided that you meet certain eligibility criteria.  It is Gattaca’s intention to claim furlough payments for any PAYE temporary workers who qualify against the detailed rules, once published by the Government, and whose assignment with our end-client has been cancelled or suspended as a result of COVID-19.

New information is being released regularly about the scheme, but Gattaca’s understanding is that PAYE agency workers will need to meet the following criteria to be eligible: 

  • They were on the PAYE payroll of Gattaca (or one of our subsidiaries) on or before 19 March 2020 and a Real Time Information (RTI) submission was sent to HMRC on or before 19 March 2020 notifying payment in respect of that worker
  • They have ceased work under the assignment as a result of Coronavirus
  • They have been furloughed for a period of at least three weeks (subject to any rules relating to the original scheduled assignment end date)

Further, the end client for whom you are providing services will need to confirm that your assignment has been cancelled or suspended as a result of Covid-19.

If you believe that you are eligible under the scheme, we need you to let us know as soon as possible by emailing covid19@gattacaplc.com, including the following information: 

  • Your full name
  • Your job title for your assignment
  • The end-client with which you were placed
  • The date your assignment ended

It is important that you act quickly as there is a deadline for us to be able to process your claim, please refer to this information below. 

 

What is the process for Gattaca to furlough me in accordance with the Job Retention Scheme?

Gattaca will require certain due diligence requirements to be satisfied that you are eligible under the scheme, including written confirmation from the end client that your assignment was terminated or suspended due to Covid-19.  You will also be required to enter into a furlough agreement with Gattaca.

Should you inform us of your eligibility, the process will then be as follows: 

  • We will request written confirmation from your end-client that your work ceased as a result of Coronavirus and will complete our due diligence checks to ensure you meet the other eligibility criteria
  • We will require you to sign a Contractor Furlough Agreement, which will be sent to you once client confirmation is received
  • Once a signed Contractor Furlough Agreement has been received from you, we will calculate your claim and submit your application via the HMRC portal
  • We will aim to process payment to you within 10 working days of receipt of your signed Contractor Furlough Agreement

 

Is there a deadline for Gattaca to furlough me in accordance with the Job Retention Scheme?

Due to the fact that the HMRC portal does not allow us to submit further, or amend existing, claims relating to a pay period for which we have previously submitted a claim, we need to enforce a deadline for confirmation of eligibility and for receipt of the signed Contractor Furlough Agreement.

For claims covering from week commencing Monday 2 March up to claims covering week commencing Monday 27 April, the deadline to receive client confirmation and a signed Contractor Furlough Agreement will be Friday 1 May. After this point, we are allowing a four-week notification period to ensure that we capture all potentially eligible contractors. For each weekly claim period, the deadline for receipt by Gattaca of client confirmation and the signed Contractor Furlough Agreement will be four weeks on Friday after each claim period.

Please refer to the timetable below:

Claim Period (Week commencing) Deadline for receipt by Gattaca of client confirmation and signed Contractor Furlough Agreement
Monday 2 March Friday 1 May
Monday 9 March Friday 1 May
Monday 16 March Friday 1 May
Monday 23 March Friday 1 May
Monday 30 March Friday 8 May
Monday 6 April Friday 8 May
Monday 13 April Friday 15 May
Monday 20 April Friday 22 May
Monday 27 April Friday 29 May
Each week until the Job Retention Scheme is no longer available Four weeks on Friday after each claim period

 

I am an Umbrella contractor, am I eligible to be furloughed under the Job Retention Scheme?

We understand that contractors who work via an umbrella company are likely to be eligible to be furloughed under the Job Retention Scheme, as they will normally work under an over-arching employment contract.  However, you will need to contact your umbrella company to check if you are eligible and whether they are in a position to furlough you at this time.

We understand from our discussions with our umbrellas and the Government that it is currently unclear whether contractors will be able to receive 80% of their full umbrella pay, as many umbrella companies pay their contractors a small salary (usually equivalent to National Minimum Wage/National Living Wage) and then top this up by way of bonus payments.  The Government’s current position is that furlough pay will only be based on basic salary and will not cover other payments like bonuses, commission or other fees/expenses.

Please speak to your umbrella provider for further information.

 

I work via my own limited company, what support am I eligible for?

The Government has announced a separate scheme for the self-employed, which says that it will be available to ‘self-employed individuals’ and ‘partnerships’.  It is currently unclear whether this will include individuals who work via a personal service company, or whether they will need to utilise the Job Retention Scheme (see background above).  We are seeking clarification on this and will update these FAQs as soon as we have further information.

If the Self-Employment Scheme is open to limited company contractors then this is likely to be more attractive than the Job Retention Scheme, as the individual can obtain a grant based on average monthly profits (calculated over a 3 year period and capped at £2,500 per month) rather than PAYE pay.  

HMRC will contact eligible self-employed people directly and they will need to fill out an online form to claim the grant, which will be paid straight into their bank account.  The Government has also confirmed that:

  • The individual is free to continue working
  • The scheme is only open to anyone with trading profits of up to £50,000
  • The scheme is only open to those who make the majority of income from self-employment
  • The individual must have submitted a tax return for 2019.  However, those who did not submit their tax return by the due date of 31 January 2020, and have not yet submitted one, can still submit a tax return for 2019 until 23 April 2020
  • The scheme will be open for at least 3 months, but it is apparently unlikely to be up and running before the end of June, so may not help with immediate cash flow issues

Further details of the Scheme are set out on the Government’s website.

 

I am working for a public sector client, is the Job Retention Scheme open to me?

Yes, although the Government has stated in the scheme guidance that it does not expect many public sector organisations to utilise the scheme, as workers in the public sector will often be providing essential services which will continue during the coronavirus outbreak, or, alternatively, that workers may be re-deployed to assist with the Coronavirus response where possible.

 

If I am furloughed under the Job Retention Scheme before I am 12 weeks into my assignment, could my pay change during the furlough period under the Agency Workers Regulations?

Under the Agency Workers Regulations (AWR), qualifying agency workers are entitled to receive at least the same pay as a permanent employee performing a comparative role for the end client, once they have been working on assignment for the client for 12 weeks.

Our understanding is that an agency worker being furloughed will ‘pause’ the assignment from an AWR perspective from the date of furlough and that the AWR time period will start to run again when the worker returns to work with the client.  This being the case, an agency worker who did not reach 12 weeks prior to being furloughed would not be entitled to any increase in pay under the AWR during the furlough period.

We are waiting for further Government guidance to confirm this point and will update these FAQs when we have further information.

 

If I am eligible for the Job Retention Scheme, do I have a right to be furloughed?

If you are a PAYE or umbrella contractor, you do not have an automatic right to be furloughed and this will be a commercial decision for the relevant agency or umbrella company.

If you work via a limited company and are a company director, you will be responsible for the decision to furlough yourself and for following the appropriate process to claim the grant, which will be paid directly to your Ltd company.

It is Gattaca’s intention to claim furlough payments for any PAYE temporary workers who qualify against the detailed rules, once published by the Government, and whose assignment with our end-client has been cancelled or suspended as a result of COVID-19.

 

If I am furloughed under the Job Retention Scheme, how will my pay be calculated?

In accordance with Government guidance, the scheme is intended to cover the lower of 80% of an employee’s regular wage or £2,500 per month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that subsidised wage. Regular wages includes past overtime, fees and compulsory (contractual) commission payments.  Discretionary payments, including bonuses and discretionary commission, and non-cash payments should not be included.  

 

When can I expect to receive payment from Gattaca under the Job Retention Scheme?

Payments for eligible furloughed contractors up to the 10 April 2020 will be added to our payroll run from week commencing 27 April 2020. The funds will then appear in PAYE Contractor accounts on the 1 May 2020. 

Moving forward, Gattaca will be making weekly payments aligned to our normal payroll run. Please note we are only able to issue funds for Contractors with agreed and returned Furlough Agreements. To qualify for the Furlough Scheme the Contractor must be furloughed for a minimum of three continuous weeks, no payments can be made until these three weeks have been confirmed. If you are requested to return to work during this three week period, please notify us immediately via your usual point of contact, or by emailing covid19@gattacaplc.com, as this may impact your ability to receive payment under the scheme. 

Below outlines Gattaca’s planned payment schedule, although please note that these dates are subject to change if further information is provided regarding a return to work which may impact eligibility for the scheme.  

Furlough period* Payment Date
Up to 3 May Friday 22 May
Up to 10 May Friday 29 May
Up to 17 May Friday 5 June
Up to 24 May Friday 12 June
Up to 31 May Friday 19 June
Up to 7 June Friday 26 June
Up to 14 June Friday 3 July
Up to 21 June Friday 10 July
Up to 28 June Friday 17 July

 

*Contractor needs to have been furloughed for a minimum of 3 continuous weeks to qualify. E.g If Furlough effective date is 4 May, 3 weeks goes to 24 May, those 3 weeks will be paid 12 June and weekly thereafter, 3 weeks in arrears.

 

Is the pay under the Job Retention Scheme subject to tax deductions?

Yes, this will be subject to normal employee PAYE and National Insurance deductions and you will still be required to make pension contributions (unless you have opted out).

 

If I am furloughed under the Job Retention Scheme, will I continue to accrue holiday?

No. As a temporary worker, you only accrue holiday in respect of time you have actually worked. As you will not be working for the agency/umbrella company while you are on furlough, you will not accrue any holiday leave or pay during this time.

 

Am I able to carry out any work while I am furloughed under the Job Retention Scheme?

If you are furloughed via Gattaca, you will not be able to carry out any work for, through on or our behalf – this includes working for a different end-client via Gattaca or any of our recruitment brands. You are free to take part in volunteer work for third parties or undertake training. 

 

What are the rules on Sick Pay where I am self-isolating because of Coronavirus?

PAYE and Umbrella contractors will be eligible for Statutory Sick Pay (SSP) where they have not been furloughed and are unable to work in the following circumstances:

  • They have been diagnosed with COVID-19
  • They are displaying symptoms of COVID-19 and are self-isolating in-line with Government guidance (see below)
  • They live in a household with someone who is displaying symptoms of COVID-19 and are self-isolating in-line with Government guidance (see below)
  • They are in the ‘extremely vulnerable’ category and have been advised to ‘shield’

 
The Government has also legislated to change the rules on SSP to make this available from day 1 of sickness absence, rather than day 4.  This legislation applies retrospectively from 13 March 2020.  PAYE contractors who consider they are entitled to SSP should notify their client and Gattaca as soon as possible.  Umbrella contractors should notify their umbrella provider.
 
To continue receiving SSP after 7 days’ absence, the worker will need to provide an ‘isolation notice’, available from NHS 111 online. 
 
The Government’s guidance on SSP and when people should self-isolate can be found here.
 
Limited company contractors will not be eligible to receive SSP from Gattaca.

 

If I am not eligible for one of these schemes, what are my options for claiming financial support?

You may be eligible for other Government support, such as Universal Credit or Employment and Support Allowance.  Please see the Government’s Coronavirus website for further information: https://www.gov.uk/coronavirus

If you have your own company, you may also be able to access some of the Government’s other support initiatives for companies.  Please see the Government’s website for further information:  https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses


The above is a statement of Gattaca’s current intended approach and does not represent any obligation or guarantee and is, at all times, subject to Gattaca’s ability to comply with the detailed rules of the scheme, when available.  Gattaca therefore reserves the right to adjust its position as clarity around the details of the scheme from official Government departments is released.