May has proven to be another challenging month for many industries across the UK, and the recruitment industry is no exception.
Coronavirus is yet again taking the spotlight this month - but there have also been updates regarding a potential future recession and another case loss for HMRC.
We’ve listed the major developments in May’s recruiter news round-up, keep reading to find out more.
Red card handed to HMRC
Football is due to make its long-awaited return to our screens this month, however May saw the case of Professional Game Match Officials Limited (PGMOL) vs HMRC.
Initially brought before the First Tier Tribunal in 2018, the case concerned match officials on contracts for services. These individuals in question would undertake refereeing duties in their spare time, typically alongside existing full-time employment contracts.
HMRC argued that these contracts for services mirrored that of an employment relationship, therefore employment taxes were due. The First Tier Tribunal disagreed with HMRC, stating that the levels of Control and Mutuality of Obligation were not enough to suggest an employment relationship was in place.
HMRC then appealed this at the Upper Tier Tribunal, however they were in agreement with the First Tier Tribunal and HMRC lost the case.
With Mutuality of Obligation being such a major factor in this case, and not the first time HMRC have lost a case on this basis, we wonder if this will lead to its inclusion in the CEST tool.
Extension of the Coronavirus Job Retention Scheme
As part of the government’s financial aid package, the Coronavirus Job Retention Scheme (CJRS) was launched to prevent redundancies and job losses as a result of coronavirus. As it currently stands, around 8.7 million people have taken advantage of this scheme, allowing them to stay in employment whilst receiving 80% of their monthly salary.
On 12th May, Chancellor Rishi Sunak announced an extension of the CJRS. This was due to finish at the end of June, but will now end in October, giving people more flexibility and time in going back to work.
Another important development in this story is that employers using the scheme can soon ask furloughed employees to return to work on a part-time basis. However, employers will be asked to contribute towards the costs of paying people’s salaries. We will update you with more information on this as the guidance becomes available.
Statutory Sick Pay Rebate Scheme opens for claims
Another measure in place to ensure businesses are supported through this pandemic, is the Coronavirus Statutory Sick Pay Rebate Scheme, which employers are now able to claim on behalf of employees who have been absent from work as a result of coronavirus, or have been made to self-isolate.
Employers with less than 250 employees are eligible to reclaim back the costs of coronavirus-related sick pay, provided there was a PAYE scheme in place before the 28th February 2020.
We’ve put together some more information about this scheme, including payments and eligibility criteria, in our guide.
Coronavirus and the economy
With many people unable to work, shops closed and the tourism industry halted in most countries, the pandemic has had a detrimental effect on the economy.
The country is in the middle of a recession, as GDP has fallen for two consecutive quarters. Not only that, but recent data from the National Institute of Economic and Social Research (NIESR) estimates that GDP is expected to fall between 25-30% between April and June 2020.