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 Employee Wage Subsidy Scheme

  

Changes to the Employment Wage Subsidy Scheme (EWSS)

 

The recent budget brought about changes to the Employment Wage Subsidy Scheme (EWSS). The changes to the scheme are set to provide a ‘lifeline’ to businesses and those whose jobs may be at risk during this time. It is also to ensure as many employees can retain the link with their employer, allowing them to return to the workforce at the earliest opportunity.

It is important to note that the payment is now linked to a person’s prior earnings and will now have four earnings related bands. These changes ensure that the Pandemic Unemployment Payment (PUP) is fairer, more equitable and sustainable and have allowed Government to extend the payment until next April.

 

The primary changes to the EWSS are:

  • In relation to PUP, the Government has now introduced a fourth rate of payment for people whose gross earnings were €400 per week or higher prior to the pandemic.
  • They will now receive €350 in their PUP payment with the rate change taking effect for all new applications received since Friday, 16th October.
  • Existing PUP recipients who previously earned more than €400 per week will have their PUP rate automatically increased and will receive the higher rate of €350 in next week’s payment run.
  • The other three rates of PUP payment (€203, €250 and €300) remain unchanged.
  • Where the Covid Restrictions Support Scheme is concerned the qualifying turnover criteria for application to the scheme is now 25 per cent of the turnover for the corresponding period in 2019. This will allow more business to access this support.

 

The new rates are as follows:

Employment Wage Subsidy Scheme:

 

Revised rates:

Gross weekly pay

 

Revised Rates

Less than €151.50

 

Nil

€151.50 – €202.99

 

€203

€203 - €299.99

 

€250

€300 - €399.99

 

€300

€400 - €1,462

 

€350

Over €1,462

 

Nil

 

If you want advice or guidance on the latest changes to the EWSS Scheme or how it affects your business, please call us today on: 01 663 2000

 

 

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What You Need To Know About The Employment Wage Subsidy Scheme

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Protecting incomes and supporting business has never been more important. The economic impact of this pandemic has been immense and without vital supports many more would have closed and more jobs would have been lost. Here we look at the Government’s latest measure to protect businesses - the Employment Wage Subsidy Scheme (EWSS).

The Employment Wage Subsidy Scheme will come into effect from 1 September 2020 to 31 March 2021 and replaces the Temporary Wage Subsidy Scheme which ends on 31 August 2020.

In summary under the EWSS, employers and new firms in sectors impacted by Covid-19, whose turnover has fallen 30%, will get a flat-rate subsidy of up to €203 per week per employee, tapered up and down depending on circumstances, including seasonal staff and new employees.

 

The main points to know are:

 

Registration for the EWSS

Employers can register for the EWSS through ROS. Employers will be required to agree to a declaration on registration.

 

Employers must:

Be registered for PAYE/PRSI as an employer

Have a bank account linked to that registration

Have a tax clearance certificate

 

The ‘30% Test’:

An employer must be able to demonstrate that their business is expected to experience a 30% reduction in turnover or orders between 1 July and 31 December 2020 and that this reduction is caused by COVID-19.

 

Eligible Employees:

A subsidy can be claimed in respect of employees of an impacted business on the payroll and in receipt of gross wages of between € 151.50 and € 1,462 per week during the period of the EWSS.

 

Tax Implications for Employees:

The payment will be regarded later in the year as a taxable payment, and income tax will be due for many hundreds of thousands of employees, arising from the payments. This is something employers need to explain to employees in advance.

For all the details on the EWSS visit: https://www.revenue.ie/en/corporate/communications/stimulus/employment-wage-subsidy-scheme

 

If you want advice or guidance on the EWSS Scheme, please call us today on: 01 663 2000

Keep Up To Date: Changes To 2014 Companies Act You Need To Know

 

shutter small commerical property

 

Recent amendments to the 2014 Companies Act show a welcome commitment from Government to backing business, supporting economic recovery and making sure as many people as possible have jobs to go back to following the impact of Covid-19. The following are the main points to the amendments of the Bill that all businesses need to be aware of:

 

EXTENSION OF INTERIM PERIOD

The measures will remain in place for an interim period up until the end of December 31st, with potential for extension of this period.

 

GENERAL MEETINGS

Businesses will now be permitted to hold their Annual General Meetings virtually. The amendments also allow companies to postpone their AGMs until December 31st and hold creditors and general meetings virtually.

 

EXAMINERS REPORT

In the past, businesses had up to 100 days to present an examiners report to the court. In order to give businesses some much needed ‘breathing space’, a provision to extend the period for examinership of a company to 150 days was made.

 

EXECUTION OF DOCUMENTS

In order to deal with the practical difficulties of officers of a company all being required to sign a single page, documents which are required to be executed under seal can be executed in counterpart i.e each of the relevant countersignatures may be made on separate pages, irrespective of any provision in the company’s constitution. 

 

DEBT THRESHOLD

It increases the threshold at which a company is deemed unable to pay its debts and can be wound up by the courts. The measure increases the threshold from €10/€20k to €50,000. 

 

In summary, the act makes the following changes:

  • provides that the measures will be operative for an interim period (up until 31 December 2020, with potential for extension of this period)
  • allows companies to postpone AGMs until 31 December 2020
  • provides that both general and creditors’ meetings may be held virtually
  • allows documents which are required to be executed under seal to be executed in counterpart
  • increases the amount at which a statutory demand can be issued from €10/20k to €50k
  • extends the examinership process to a total of 150 days (subject to court approval)
  • provides the Minister with regulation making power in respect of extending the interim period and amending the operational detail of hybrid and virtual general meetings

 

For a full copy of the Act, visit: https://data.oireachtas.ie/ie/oireachtas/act/2020/9/eng/enacted/a0920.pdf

 

If your or your business need advice on any of the changes to the Act and how they affect your business, our team of corporate solicitors are available to chat with you. Contact us at: 01 663 2000

New Government Supports For SME’s Bring Much Needed Relief For Irish Businesses

 

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There is no doubt about it, times are tough, particularly for SME’s, however the recent announcement of a new grant scheme is welcome news and we hope will help the many SMEs suffering due to the impact of Covid-19 and the resulting economic downturn.

The Restart Grant Plus scheme, which is part of the July Stimulus from the Government, aims to help SMEs adapt and re-open following Covid-19 restrictions. SMEs in Ireland can now apply for restart grants from €400 to €25,000.

To qualify for the scheme, enterprises must have:

  • 250 employees or less;
  • Turnover of less than €100,000 per employee; and
  • Reduced turnover by 25% as a result of COVID-19

Under the scheme, support will also be provided for enterprises that could not access the original grant scheme. There is also increased eligibility for non-rateable B&Bs, sports clubs with commercial activities and trading charity shops.

Some of the other criteria for qualifying for the scheme state that businesses must be commercial and in the local authority rates system, and have suffered a 25pc loss of expected turnover between 1 April and 30 June 2020. Businesses must also commit to reopening and to hiring and sustaining employment.

Interested businesses can apply through their local authorities. If you are unsure if you qualify or want further advice or guidance on the scheme, please give us a call on: 01 663 2000.

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Reopening of Businesses and The Refusal of Employees to Return to Work

As businesses prepare to re-open as part of the phased lifting of restrictions by Government, one thing that is clear is that employers and workers will need to adopt a collaborative approach to ensure a safe workplace moving forward. The Government have published a Protocol around the return to work, which is available here.

Long-term commercial viability in the wake of Covid-19 may be a serious concern for some businesses, and a number of issues can present a threat to reopening. These include the mobility of workers, implementation of physical distancing, and a reluctance or refusal by workers to return to the workplace.

Provided that the Government recommended safety measures have been adopted by employers and provided there is no imminent danger of workers contracting Covid-19 by virtue of their presence in the workplace (and/or commute to work), it is reasonable for employers to require employees’ attendance on reopening. Undoubtedly employers will be required to take all reasonable steps to safeguard employees in the workplace.

 

What Happens if an Employee Refuses to Attend the Workplace?

Irrespective of any written contracts that may or may not cover an individual’s employment, there may be implied terms (unwritten) for every contract of employment (written or unwritten) that a worker will perform their duties. In the event that attendance of employees is required at the workplace in order to do so, then a refusal by the employee may be a disciplinary matter.

If an employee is in a position to perform their duties from home, then the legal position of the employer is slightly more complex. In such situations, a reasonable approach should be adopted by employers pending Government advices on working from home.

 

Unfair Dismissal

Any employee with 12 months’ service whose employment has been terminated will have the option of bringing a claim before the Workplace Relations Commission for Unfair Dismissal. While the conduct of the employee will be taken into account in determining the overall reasonableness of the dismissal, the test is generally one of fairness and not of law. As such, it is important for employers to take steps to limit their exposure to claims for unfair dismissal. A non-exhaustive list of steps that should be taken is set out below:-  

  • Engage with the employee to establish the reasons behind their refusal to return to work.
  • Consider whether any concerns of the employee are merited, and what could be done to address them.
  • Request written notice from the employee that they will not be returning to work as requested.

It is always recommended that employers take advice before terminating an employee to best position themselves to defend any legal action arising from the termination.

 

Covid-19 Payment

There is a weekly social welfare payment for employees that have lost employment (including temporarily) as a result of Covid-19. This payment is not intended to apply to employees that are simply refusing to return to work. Should employers have cause to suspect that an employee is refusing to attend for work but intends to continue receiving this payment, they should notify Revenue that the relevant employment is now available. Employees should also be put on notice of this prior to Revenue being contacted.

 

For more information please contact Clodagh Gill, Solicitor or Robert Dooney, Associate.

 

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