Along with announcements about protecting the income of employees and the self-employed (LELRs 664 to 666), there is also separate and specific Cabinet Office guidance for suppliers of “contingent workers” to certain public sector bodies where they cannot work due to coronavirus (COVID-19).
The guidance applies to central government departments, their executive agencies and non-departmental public bodies. Other public sector contracting authorities are encouraged to apply the same approach.
Contingent workers include temporary staff such as contractors and freelance workers, as well as agency workers. Specifically, the advice makes clear that it covers those who are on employers’ PAYE systems and those who work through umbrella companies and personal services companies.
The stated purpose of the guidance is to protect the livelihood of contingent workers,
guard against the risk that some may attend work when they should be self-isolating and to assist suppliers and keep them solvent.
The guidance essentially states that contingent workers who cannot work because of coronavirus (COVID-19) should be paid for at least three months at 80 per cent of the rate of pay before their absence, up to a maximum of £2,500 per month backdated to 1 March 2020, if necessary. This covers workers who cannot work because they are sick, in self-isolation or as a result of workplaces closing and who cannot work from home.
The £2,500 monthly cap relates to gross pay, excluding statutory costs such as National Insurance, pension and holiday pay. If the worker has already claimed statutory sick pay, this would have to be deducted so that the total payment does not exceed 80 per cent of gross pay up to the level of the cap.
The calculation for working out whether the threshold has been hit should be based on the number of hours or days the worker is engaged to work, up to a maximum of 20 available working days in the month. If they work on an ad hoc basis, suppliers should look back over the previous 12 weeks (or for as long as the worker has been working on the assignment) to determine the average days or hours worked.
In order to allow public bodies to identify and pay the 80 per cent figure, workers should submit a timesheet which should be for 80 per cent of normal working hours.
Where workers are unable to work for some days due to coronavirus (COVID-19) and their normal monthly pay would exceed the cap of £2,500 per month, the guidance makes clear that their maximum daily earnings will be subject to a cap of £125 per day.
When a worker falls ill because of coronavirus (COVID-19), the advice says that they should alert their supplier in the first instance who must then try to ascertain if arrangements can be made so that they can work from home. If that is possible, they will continue to be paid as normal. If not, the supplier will have to make the relevant adjustments to pay. Where a contingent worker is absent for a full week this will not count towards the 12-week qualifying period for the purposes of accruing entitlement to parity pay under the Agency Worker Regulations 2010.
If a contingent worker’s assignment is coming to an end, they are entitled to be paid 80 per cent of their normal earnings (subject to the cap) but only until the date the assignment is due to expire. In other words, there is no obligation on public bodies to extend any assignment.
You can read this guidance in full here.
Articles shared by Thompsons relating to coronavirus (COVID-19) are correct at the time of publication. You should check the government's guidelines for the latest information and advice at https://www.gov.uk/coronavirus.