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Changes to the CJRS

The Chancellor has announced reforms to the Coronavirus Job Retention Scheme (CJRS). We are awaiting updates to the Treasury Direction (the formal rules which govern how HMRC is to operate the scheme) and the published guidance for employers for the finer detail - but these are the headline points that have been announced:

10 June 2020 will be the last day that employers can place employees on furlough.

From 1 July, 'flexible furlough' is being introduced, meaning employees will be able to work part-time and be furloughed part-time.

From 1 August, employers will have to pay employer's national insurance contributions (NICs) and pension contributions on furlough pay. Currently, the government meets the employer’s NICs and the equivalent of the minimum employer’s auto-enrolment pension contributions.

From 1 September, the government will only reimburse 70% of salary (up to a maximum of £2,190). Employers will be required to top-up to 80% (or more, depending on what the arrangement is with respective employees).

From 1 October, the government will only reimburse 60% of salary (up to a maximum of £1,875), and employers will continue having to top up to 80% (or more).

The furlough scheme will close on 31 October.

The Chancellor warned earlier in May that employers would be expected to bear some of the costs of furlough after the end of July, and this has already prompted many to implement, or at least start planning, the redundancy dismissals of employees for whom furlough has been only a reprieve.

On the other side of the coin, the introduction of the ability for employers to have employees working shorter hours and claim funding under the CJRS in relation to the balance of their hours is intended to help businesses re-start and build up their operations as lockdown measures are relaxed.

The big unknown is how the scheme will operate in this respect. The government has stated that further guidance, including as to how employers should calculate such claims, will be published on 12 June. We know that it will be for employers to determine the split between working and non-working hours, to be claimed for in minimum blocks of a week.

On the face of what has been announced, this arrangement will only apply to employees with normal working hours. But what about employees who do not have normal working hours? Will provision be made for them, perhaps with similar principles being applied as when determining furlough pay for such employees, with reference being made to average hours worked in the previous tax year and the hours worked in the corresponding month in 2019?

For the current formalities to be complied with when putting employees on furlough under the CJRS and my comments in the context of part-time furlough, see my blog on the latest Treasury Direction here.

To emphasise, however, consideration should always be given to the contract of employment before furloughing employees, and the same applies when newly introducing part-time furlough arrangements. Some contracts contain lay-off and short-time working provisions, which allow the employer to lay the employee off without pay, or to reduce their hours and reduce their pay proportionately. Just as these clauses allow employers to readily furlough employees completely on no more than 80% of their pay (subject to the cap under the CJRS), they will allow employers to dictate part-time furlough arrangements and to pay employees no more than the amount recoverable under the CJRS for such hours that are not worked.

For employers without the benefit of such contractual provisions, if they are not going to pay affected employees in full regardless of any reduction in working hours, to act lawfully, they will need to do one, or a combination, of two things: obtain the binding consent of employees, or impose the arrangement after applying appropriate procedures. What will constitute “appropriate procedures” will be a matter for legal advice according to the particular circumstances.

Where consent alone is to be relied upon (i.e. if contractual changes are not to be imposed on any dissenters), collective consultation will not be a consideration.

However, if that is not the case and 20 or more employees are to be affected at one establishment within a 90-day period, this will require a collective consultation process – and there will be a moratorium on effecting the required contractual changes of 45 days from the commencement of that consultation if 100 or more employees are affected, or 30 days if fewer than 100 are affected. (Employers who are also contemplating redundancy dismissals should bear in mind that any employees they propose to dismiss may part of the head-count for collective consultation thresholds, depending on the circumstances.)

Adding in time to plan and execute the process and then give contractual notice of changes, plus considerations about by when affected employees are expected to return to work full time or else be made redundant, means that in many cases an approach which involves collective consultation won’t be practicable. How to address such considerations, to include possible commercial solutions, is a matter for legal advice according to the particular circumstances.

The self-employed grant is being extended, with applications opening in August for a second and final grant. There will be parity with the reducing furlough scheme, paying 70% (not 80%) of average earnings up to £6,750.

New CJRS Treasury Direction

On Friday 22 May 2020 the Treasury published a further Direction (dated 20 May) modifying the legal framework for the Coronavirus Job Retention Scheme (CJRS).

The first Direction was issued on 15 April 2020. The new Direction will apply to claims under the CJRS which are made after its publication, and to claims made on or before that date where they would have been compliant with its terms.

The new Direction extends the scheme only until 30 June 2020, so a further Direction will be needed for the extension of the current terms until 31 July, and for the new terms applicable from August – for details of which click here.

Many of the changes are on issues where the first Direction conflicted with HMRC’s published Guidance and are in line with that Guidance or have clarified areas of uncertainty. There are also some new provisions, which presumably will be reflected in further iterations of the Guidance in due course.

Requirements for placing an employee on furlough:

In general terms, perhaps the most significant change is the amendment to the requirements for placing an employee on furlough.

The first Direction required a written agreement between employer and employee that the employee would cease all work in relation to their employment – notwithstanding that HMRC’s Guidance initially suggested that only written confirmation of being furloughed was required for the purposes of eligibility under the CJRS, and subsequent versions stated that furloughing should be consistent with employment law but didn’t otherwise need a written agreement. This caused quite a degree of turmoil, and debate over the sense of this element of the Direction and whether it would be amended or, if not, actually enforced.

There has indeed been an amendment. The new Direction provides that, for the purposes of eligibility to make a claim, the required instruction to cease work is satisfied if:

  • the employer and employee have agreed that the employee will cease all work in relation to their employment – and this can be made by means of a collective agreement between employer and trade union
  • the agreement specifies “the main terms and conditions upon which the employee will cease all work”
  • the agreement is incorporated expressly or impliedly in the employee’s contract
  • the agreement is in writing or is confirmed in writing by the employer (and writing includes in electronic form)
  • the employer keeps the agreement/collective agreement/confirmation until at least 30 June 2025

Employers who did not obtain written agreements from furloughed employees (whether because they were not varying any contractual terms, or because changes were agreed orally) will welcome this change. They may also be able to rely on the new Direction in respect of past claims (if those claims complied with all the provisions of the new Direction).

However, employers should note that there is still a requirement for agreement, and for a written record to be made of that agreement (covering both the cessation of work and the applicable terms). It remains unclear whether the agreement itself can be retrospective or implied (although there is nothing expressly prohibiting this). It would obviously be prudent to ensure these new provisions are satisfied for newly furloughed employees and to provide written confirmation of the agreement for those already furloughed if this has not yet been done.

It is unfortunate, in our view, that reference to the employee agreeing to cease work remains. In general terms, where an employer continues to pay an employee in full, it is not obliged to provide the employee with work, and so does not require the employee’s consent that they cease work. Similarly, if there is a lay-off clause, the employer has the right to direct the employee to not work. However, in our view it is unlikely to be an issue if employers in those circumstances simply record in writing that the employee ceased work from the relevant date – including because this will not be inconsistent with the published guidance and HMRC are unlikely to take the point when carrying out audits – and if they do, they will be vulnerable to judicial review applications.

Reference salary for women returning from maternity leave and others family leave or sick leave:

Another key change is to the reference salary for those taking furlough after a period of statutory family-related leave or sick leave.

For fixed rate employees, the reference salary has always been, and continues to be, the normal, full salary as at 19 March. However, for other employees, this had been stated to be the higher of the average pay received in the last tax year or the corresponding month in 2019 – which would cause many women returning from maternity leave, and others in this category, to be much worse off.

However, under the new Direction, the reference salary is to be calculated as if the employee had been on paid annual leave receiving normal pay required under the Working Time Regulations during those periods.

The published Guidance already stated that for employees on variable pay who have been on unpaid sabbatical or unpaid leave, their reference salary for furlough pay should be the amount they would have been paid if they were on paid leave when calculating 80% of their wages. The new Direction reflects this.

Other changes:

It seems that, consistent with HMRC Guidance, the employer and employee can now agree to end a period of SSP in order to start furlough (notwithstanding that the employee would otherwise continue to be eligible for SSP).

Where a period of unpaid leave started before 1 March, and the employer and employee reached an agreement before 20 March 2020 to end it earlier than originally planned, the employee can be put on furlough after the revised end-date.

No claim under the CJRS can be made for a period of unpaid leave between 1 March and 30 June and furlough cannot begin during that period - although there is no express prohibition on ending that leave earlier than planned in order to furlough.

A director will not be treated as doing work (and therefore outside the CJRS) where they are simply making a CJRS claim for, or paying wages to, an employee of the company.

The carrying out of duties as a trustee or manager of an occupational pension scheme is also permitted (save where the employer’s business is the provision of occupational pension scheme independent trustee services).

Furloughed employees can now study or do training even if it is not directly relevant to the employee’s job and agreed in advance – its purpose can be to generally improve an employee’s effectiveness in the employer’s business or the performance of the employer’s business, provided it does not contribute to business activities, generate income or profit, or significantly contribute to the production of goods or services for sale.

It is now clearer that, when calculating the reference salary (80% of which is to be paid, subject to the cap of £2,500 per month), benefits provided through salary sacrifice are not included, but variable payments for overtime, timing of shifts or additional duties will be included provided there is no discretion about how the amount is to be calculated.

The relevant date for TUPE transfers has been changed to 28 February in line with the current Guidance. A new provision extends the CJRS coverage to TUPE business transfers from an insolvent transferor (where the automatic transfer of employment contracts does not apply) and transferors will be able to claim for employees whose pre-transfer furlough periods do not last 21 days where the employees continue on furlough with the transferee.

Test & Trace & SSP

Under the Test and Trace system that launched on 28 May, a person who has been notified that they have had contact with a person with coronavirus is to self-isolate for 14 days. The rules relating to statutory sick pay have been amended to include employees who are self-isolating in these circumstances.

If such a person develops symptoms of coronavirus, they are to apply for a test, and if that is positive they must self-isolate for 7 days from when they developed symptoms.

For further details relating to SSP in the context of coronavirus, including the ability of employers to reclaim up to 2 weeks’ SSP per affected employee, click here.

Should I Drive if I am Concerned about my Eyesight?

In my role as a personal injury solicitor I specialise in assisting HGV drivers following accidents they have had while driving or while loading and unloading. Existing and previous clients will often call me with general legal queries they may have, and I am happy to assist wherever I can. One called recently about a story in the press, you have no doubt heard about, and what the correct thing to do is, if you are concerned about whether your eyesight is good enough to drive on a long journey.

The first thing I would advise to do in normal circumstances would be to arrange an eye test. As that is unlikely to be possible in the current climate I would suggest that if at all possible you should see if there was anyone else available, possibly your partner to drive instead of you. If this is not possible, I would advise strongly against driving a vehicle to test whether your vision was good enough, and certainly not on a 60 mile round trip; your vision is either good enough to drive or its not, and if it is not, you are putting your own and other’s lives at risk by driving.

The answer, as with most things driving related, lies in the Highway Code, which states that to drive you must be able to read a number plate from a distance of 20 metres. This can be done wearing glasses or contact lenses. So, if you can read a number plate, in daylight, from this distance, your vision is considered good enough to drive. This of course is done at the start of your driving test. I think we would all agree that this is a much safer option than driving 60 miles to test your vision.

Domestic Abuse Bill: A Step in the Right Direction

It could be argued that the current, confusing compilation of domestic abuse laws, policies and procedures has failed the victims and survivors of domestic abuse. In 2019, the introduction of the Domestic Abuse Bill sought to rectify the situation. Unfortunately the Bill failed to pass through Parliament before it was dissolved on 6 November 2019 and so we currently eagerly await the House of Commons Committee stage.

The aim of the Bill is to promote awareness of domestic abuse, to provide protection and support to domestic abuse survivors and their families, and to provide a more effective response to perpetrators. The Bill appears promising from its aims, but how far these aims will be achieved in practice can only be speculated on.

Potential changes to be implemented by the Bill:

A statutory definition recognising the fact that domestic abuse encompasses physical, emotional, coercive or controlling and economic abuse.

This statutory definition comes not long after we saw the criminalisation of controlling and coercive abuse. The existing cross-government definition of domestic abuse currently operates on a non-statutory definition. Providing the definition on a statutory basis will hopefully ensure that domestic abuse is properly understood, in particular the separate identification of the wider types of abuse such as economic abuse. The aim is to ensure all agencies such as the NHS, police and local authorities are all applying a common definition and to educate everyone’s understanding as to what domestic abuse means.

The introduction of a Domestic Abuse Commissioner

Nicole Jacobs is designated to undertake the brand new role of Domestic Abuse Commissioner. The Commissioner will oversee and monitor the implementation of the new provisions. They will expectantly raise public awareness of domestic abuse and ensure universal practice on a national level by providing independent and objective advice. Government Ministers and specified public bodies will have a public duty to respond to the Commissioner’s recommendations within 56 days.

Provide for a new Domestic Abuse Protection Notice (DAPN) and Domestic Abuse Protection Order (DAPO)

DAPNs and DAPOs are available for all types of domestic abuse, including controlling and coercive behaviour. The courts will be able to make DAPOs on their own accord in any type of proceedings; the DAPOs will have flexible duration so that they can be used to protect victims for the long-term where necessary. A DAPO will be used to impose both rehabilitative provisions on offenders (such as alcohol/substance misuse programmes) as well as prohibitive measures (such as preventing offenders from contacting their victims). Breach of a DAPO is a criminal offence and carries a maximum custodial sentence of up to five years, or a fine, or both.

A duty on local authorities to support domestic abuse victims and their children staying in refuges and other safe accommodation

A four part statutory framework will be in place to ensure all victims of domestic abuse and their children can access the right support within safe accommodation. The statutory framework will achieve the following:

  • Place a duty on each tier one local authority to appoint a multi-agency Domestic Abuse Local Partnership Board which it will consult.
  • Require local authorities to have regard to statutory guidance in exercising their function.
  • Require the Secretary of State to produce statutory guidance.
  • Require tier two councils to co-operate with the lead local authority.

Safe accommodation includes: sanctuary schemes, refuge, specialist safe, dispersed and move-on accommodation.

Prevent perpetrators/alleged perpetrators being able to cross examine their witnesses in Court and vice versa

Where necessary, the Family Court will have the power to appoint a publicly-funded advocate to conduct cross-examination. The aim is to prevent the horrific trauma and distress cross-examination can bring to victims. The regulations that qualify for an automatic ban will be introduced. It is expected that all forms of domestic abuse will qualify as well as protection for a wider range of vulnerable witnesses in the family court. The perpetrator does not have to have a conviction, caution, charge or injunction against them and other evidence of domestic abuse such as that used to consider the criteria for legal aid will be sufficient for qualification.

Create a statutory presumption that victims of domestic abuse are eligible for special measures in the criminal courts (for example, to enable them to give evidence from behind a screen or via a video link)

Usually, for a witness to be eligible for special measures when giving evidence, the court needs to be satisfied that the quality of the witness’s evidence is likely to be diminished due to their fear/distress about testifying. Victims of domestic abuse automatically qualify under the presumption if they fall under the new statutory definition of domestic abuse and so no longer have to satisfy this test. However, the court will still need to consider if the measures are needed to improve the quality of the witness’s evidence when deciding to provide special measures and if so what measure(s) are needed. It should be highlighted the statutory presumption applies in the criminal courts and not the family courts.

Enable domestic abuse offenders to be subject to polygraph testing as a condition of their licence following their release from custody

The government will implement a three year pilot of mandatory polygraph examinations on domestic abuse perpetrators released on licence identified as being at high risk of causing serious harm. Offences classed as being high risk include those who have breached DAPO, domestic abuse restraining orders and controlling or coercive behavior, all where the offender was sentenced to at least 12 months imprisonment.

Offenders will take the test three months post release from custody then every six months thereafter, unless the test is failed in which case offenders will need to take the test more regularly. Offenders could also be given a formal warning or made subject to additional licence conditions if they fail the test. The tests are designed to detect physiological changes in the offender’s body. Evidence suggests that polygraph testing has resulted in the safeguarding of children and vulnerable adults.

Place the guidance supporting the Domestic Violence Disclosure Scheme (“Clare’s law”) on a statutory footing

Due to Clare’s Law, disclosure can be made by the police to a victim/potential victim about their partners abusive/violent offending. The guidance supporting Clare’s Law will be put into statute to place a duty on the police to have regard to the guidance. It is also designed to increase the awareness of the scheme among the public and produce consistency in the application of the guidance.

Ensure that where a local authority, for reasons connected with domestic abuse, grants a new secure tenancy to a social tenant who had or has a secure lifetime or assured tenancy (other than an assured shorthold tenancy) this must be a secure lifetime tenancy

This measure is introduced to help victims of domestic abuse leave their abusive home without the fear of losing their security of a lifetime tenancy. When re-housing existing lifetime social tenants or granting new lifetime tenancies, local authorities will grant a new lifetime tenancy where the tenant or a member of the household has been a victim of domestic abuse and the new tenancy is granted in connection with that abuse.

Extend the extraterritorial jurisdiction of the criminal courts in England and Wales, Scotland and Northern Ireland to further violent and sexual offences

Where UK nationals/residents commit certain violent and sexual offences outside the UK, the Bill will allow the perpetrators to be brought to trial in the UK. The Bill comes after the UK signed ‘the Council of Europe Convention on preventing and combating violence against women and domestic violence’ (the ‘Istanbul convention) in 2012. The UK already has extraterritorial jurisdiction over certain offence in the Istanbul Convention: murder/manslaughter in most circumstances, sexual offence when the victim is under 18, forced marriage and female genital mutilation. The Bill now extends extraterritorial jurisdiction to other offences such as sexual offences where the victim is over 18 and other types of murder/manslaughter not previously caught.

Comment

“There are some 2.4 million victims of domestic abuse a year aged 16 to 74 (two thirds of whom are women) and more than one in ten of all offences recorded by the police are domestic abuse related.” The Domestic Abuse Bill could not have come at a more crucial time. Due to the stringent lockdown measures, the National Domestic Abuse helpline have received an estimated 25% increase in calls and online requests. The symbolic effect of the Bill outweighs any potential uncertainties that will always remain when trying to eradicate such a sensitive, unique form of abuse. In particular, the Bill acknowledges different types of abuse such a technological and economical abuse.

It is also hoped the new DAPN and DAPO will provide a more collaborative approach to domestic abuse as opposed to the current confusing variety of reliefs available across various courts. As stated the new DAPNs and DAPO will allow Courts to impose rehabilitative programs on perpetrators as well as preventive measures. The route of the problem is therefore considering proactive measures as opposed to omissions. Addressing the route of the problem will expectantly provide longer term solutions and reduce the number of repeat offending.

It has been questioned whether the Courts will have sufficient resources to monitor the new measures and this may be something the Domestic Abuse Commissioner addresses. At second reading on 28 April, the House of Commons also identified that to achieve the extensive aims highlighted above, there needs to also be long-term, adequate funding for Councils. Thus, we will have to see if the aim of providing long-term protection to victims can be achieved in practice.

Where there's a Will .......

How do you sign a Will in the midst of a pandemic when you’re not allowed to be within two metres of anyone? Well, as we at Lanyon Bowdler have discovered: where there’s a Will there’s a way…

In England and Wales, in order for your Will to be validly executed, it must be signed by you in the presence of two independent witnesses, who must also sign the Will in your presence. In a recent article [LINK TO POST] we looked at the difficulties in validly executing your new Will during the current COVID-19 outbreak, whilst correctly observing the rules around social distancing, and the options available to you.

Since the beginning of the current lockdown and the implementation of social distancing, we have been able to assist many clients in successfully completing new Wills during the Coronavirus outbreak, and we have seen some very creative solutions when it comes to having the Wills witnessed whilst maintaining an appropriate distance of two metres from one another.

As was suggested in the above article, several clients have taken to having their witnesses observe them signing their Wills through a window before passing the Wills to the witnesses (by placing it on the doorstep) for them to then sign. We have been told that everyone used their own pens to minimise the risk of contamination.

During the pleasant weather in April we learnt from one couple that they had their neighbours witness their signatures over the garden fence. The clients signed the Wills before passing them over the fence to their neighbours using a garden rake. The witnesses then signed the Wills and passed them back over the fence using their own garden tool – a shovel – to again avoid cross contamination. To some extent, signing documents outside in the sunshine might even be preferable to doing so in the office!

When taken out of context these scenarios would seem utterly bizarre, but during these troubling times they demonstrate creativity and ingenuity. They show how brilliantly people can adapt and find a way to ‘get the job done’ despite obstacles presented by these difficult times.

Finally, we will leave you with a moving story involving a client who discovered he had terminal cancer when routine x-rays picked up the cancer following a bone fracture.

He wanted help to prepare his Will rather urgently whilst he was still in hospital. Unfortunately, whilst in hospital he was suspected of having COVID-19, so we were unable to attend to witness his Will. Instead, we were able to arrange for an oncologist and the hospital chaplain to witness the Will for him. The Will was hand delivered through a window at the hospital to a member of staff, who then gave it to the client.

He signed his Will and was then told he tested negative for COVID-19, which was great news. But the story doesn’t end there… The client subsequently married his long-term partner in the hospital ward, thus revoking his new Will! He then instructed us to make some slight - but very important - amendments to his Will (such as changing his partner’s name and referring to her as his wife) and we sent him a new Will at no extra cost to sign. He is now receiving palliative care at home.

Our experiences since the beginning of the current lockdown show that despite these very challenging times we currently live in, there are ways of getting around these situations. If you want to talk about your Wills or any other related issues, then please get in touch with one of our experienced private client solicitors.

Coronavirus Statutory Sick Pay Rebate Scheme

A new online service will be launched on 26 May for eligible employers to recover coronavirus-related statutory sick pay (SSP) that they have paid to their employees.

The Coronavirus Statutory Sick Pay Rebate Scheme was announced in the Budget as part of a package of support measures for businesses affected by the Covid-19 outbreak.

Employers are eligible to for the scheme if they have a PAYE payroll scheme that was created and started before 28 February 2020 and they had (if applicable, in combination with any connected companies or charities) fewer than 250 employees before the same date.

The repayment will cover up to 2 weeks of SSP paid to employees who were eligible to receive it in circumstances where they were unable to work because they either:

  • had coronavirus symptoms;
  • were self-isolating because someone they live with displayed coronavirus symptoms; or
  • were shielding in line with public health guidance

for periods of sickness starting on or after:

  • 13 March 2020, if the employee had coronavirus symptoms or was self-isolating because someone they live with displayed symptoms; or
  • 16 April 2020, if the employee was shielding.

The rate of SSP was £94.25 up to 5 April 2020 and the current rate is £95.85 per week. Where an employer paid, or pays, more than the rate of SSP in sick pay, they will only be able to reclaim the SSP rate.

For our guidance on eligibility for coronavirus-related SSP and our further comments on the rebate scheme, click here and for the full government guidance on the rebate scheme, click here.

Holiday & COVID-19

The government has published guidance on workers' entitlement to holiday and holiday pay during the COVID-19 pandemic. It addresses the position of workers who continue to work and those who have been placed on furlough under the Coronavirus Job Retention Scheme (“the Scheme”). However, it has no legal effect, and tribunals are not required to follow it when deciding holiday cases.

The new guidance confirms that furloughed workers accrue holiday like any other worker, and can take holiday subject to the usual notice provisions, without breaking the furlough period. However, employers must pay normal pay during holiday, and may therefore need to top up any furlough pay. This much has been stated in the government’s separate guidance on the Scheme for some time – but the guidance on the Scheme is silent on when employers can compel furloughed employees to take holiday.

On this point, the new guidance states:-

"If an employer requires a worker to take holiday while on furlough, the employer should consider whether any restrictions the worker is under, such as the need to socially distance or self-isolate, would prevent the worker from resting, relaxing and enjoying leisure time, which is the fundamental purpose of holiday."

The caveat reflects principles set out in European case law, which call into question whether an employer can force a worker to take holiday at all during the “lockdown”, not merely during furlough - but the government does not offer an answer to the question and so may be adding to, rather than helping to resolve, confusion among employers as to their legal obligations.

Our view is that employers can compel employees to take holiday during the period of restrictions on social movement, including employees on furlough, on the basis that they are not prevented from resting or relaxing or (albeit perhaps not as much as in normal circumstances) enjoying a period of leave. The more the “lockdown” measures are relaxed (as they have started to be), the stronger this argument becomes.

To confirm, as indicated in the new guidance, unless a contract of employment or some other workforce agreement provides otherwise, if an employer wishes to compel an employee to take part of their holiday entitlement under the Working Time Regulations, they must provide notice of at least twice the duration of the holiday to be taken.

The guidance also deals with the practical effects of the Working Time (Coronavirus) Amendment Regulations 2020, which permit the carry-over of any untaken leave due to COVID-19. It gives examples of when it might be considered not reasonably practicable to take holiday during the leave year. It suggests that for furloughed workers, carry-over would rarely be justified if they were able to take holiday during the furlough period (although it might be justified if the employer could not afford to top up their pay).

The guidance also deals with holiday rights for agency workers.

Coronavirus Job Retention Scheme Extended to End of October

The Chancellor, Rishi Sunak, has announced today that the Job Retention Scheme will be extended to the end of October.

There are to be no changes in the Scheme until the end of July: 80% of employees’ pay up to a cap of £2,500 per month will still be funded, plus associated auto-enrolment pension contributions and employer national insurance contributions.

However, the Chancellor said the government will ask companies to "start sharing" the cost of the scheme from August onwards, with “greater flexibility to support the transition back to work”.

Employers are to be able to bring furloughed employees back part-time whilst still being able to claim funding – something which is not possible at present.

More details are to be announced by the end of May.

The Impact of COVID-19 on Witnessing Documents

When it comes to the witnessing of deeds, there are rules in place to protect the interests of the parties involved. The purpose of signing a document as a deed is to remove any ambiguity or potential issues that might arise in respect of the validity of the deed.

One of the most prominent rules of best practice is that the witness to a signature should be an independent party and should not be a family member of the individual signing. These rules are widely acknowledged to be correct in the eyes of the legal system, but they are given no statutory support. This means that it is still a possibility for a family member to be a witness to a signature.

Rules for witnessing documents

  • The witness will be an independent party
  • The witness may not be a family member or another party to the contract
  • The witness will be physically present
  • The witness signs to attest the signature of the signatory

How has COVID-19 affected these rules?

Given the current ‘stay at home’ guidance, logistical challenges have arisen for those who are currently in the process of entering into contracts.

In a world where working from home and video conferencing has very quickly become the norm, it seems a reasonable suggestion that witnessing via video link might be a good option. However, in a 2019 report, the Law Commission were not convinced that witnessing via video link was a valid option for deeds and so, this cannot be done without scope for potential objection into the validity of the deed in the future.

Prior to COVID-19, it was acknowledged by the Lord Chancellor that there were concerns surrounding document execution. The Law Society have more recently issued updated guidance that the law has remained unchanged since the outbreak of the pandemic.

Law Society update

It has been recognised that the need for electronic signatures, virtual execution and witnessing of documents has increased dramatically over recent weeks and that further clarification is needed to provide certainty for solicitors and their clients.

The Law Society guidance aims to allow transactions to continue in an evolving commercial environment, in a practical and pragmatic manner, whilst providing legal certainty.

Witness criteria

General guidance states that the practical means of witnessing different forms of electronic signature will need to be settled on a case-by-case basis, with consideration given to the evidential weight of the form agreed. However, the leading opinion is that it is best practice for the witness to be physically present when the signatory signs, rather than witnessing through a video conferencing facility, in order to minimise any evidentiary risk as to whether the person genuinely witnessed the signing.

Even in light of COVID-19, this has been accepted by The Law Society to remain as best practice. However, given health risks, it has been suggested that it may be necessary to modify practice to suit the current circumstances.

New ‘Best Practice’

The Law Society have stated that this can be achieved by obtaining a number of verification sources. It has also been suggested that there is no reason why the document cannot be signed using a combination of different methods, so long as each party uses a valid signature method.

The witnessing of documents during this period of uncertainty will be dealt with on a case-by-case basis. This decision process will have regard to the type of document, the brevity of the document and the nature of the transaction. With there being no statutory restrictions on spouses being the witness to a deed, this is a viable option in the current circumstances and is more likely to be upheld as valid than it would be in a normal working situation.

If you would like more information or advice regarding the witnessing of documents, please contact the corporate and commercial department.

Coronavirus: Changes to Social Care, NHS Funding and Educational Support

On 25 March 2020, the Coronavirus Act 2020 received Royal Assent. While most of us will be aware of the more familiar aspects of the Act from media coverage, the Act also introduced powers that deal with state provision of care and educational support for vulnerable children and adults.

Social Care

Under a series of “easements” provided by the Act, local authorities no longer have to undertake an assessment of a person’s care needs, as required under the Care Act 2014 in England and under the Social Care and Well-being (Wales) Act 2014, nor determine eligibility to have such needs met, or provide a care and support plan to meet those needs.

It should be noted that these provisions are permissive, so that, rather than having an immediate and uniform effect across the country, each Social Care department has been left to make a decision at local level as to whether to apply the easements. Where a local authority makes a decision to apply these easements, it means that it still has the power to carry out needs assessments and meet those needs, but it is not under a duty to do so.

Where a local authority does decide to meet a person’s care needs, the Act removes the obligation on that local authority to carry out an assessment of the person’s ability to pay for any services. However, they have been given powers to carry out financial assessments at a later date, and can charge retrospectively.

People are encouraged to contact their local authority to establish whether it has decided to implement the provisions as we are aware that this information is generally not being publicised at local level.

Continuing Healthcare Funding

The Act also removes the duty of the NHS and Clinical Commissioning Groups in England to undertake an assessment of a person’s eligibility for CHC funding, or to have regard to the National Framework that governs such assessments.

Such assessments are likely to be deferred until after the emergency period and it is anticipated that where it appears to the relevant NHS or CCG body that a person may have such needs, they will be discharged from hospital on a NHS-funded pathway.

Educational Support

Where a child has the benefit of an Education Health Care plan (EHCP) agreed and provided by the local authority, the Act permits the absolute duty of the local authority to make such provision to be replaced with a “reasonable steps” duty. What may amount to reasonable endeavours has not been defined and, to date, local authorities have not been provided with guidance.

Note that these changes will only apply if and when the Secretary of State, or the Welsh Ministers, make an order to this effect. To date, no such order has been made.

Containers as Homes, Businesses & Shops: From a Planning Lawyer's Perspective

We have received a number of queries about installing and living in storage containers – so-called ‘container homes’ – particularly on agricultural land or within the countryside. Judging from the articles like these - https://www.sjonescontainers.co.uk/containerpedia/shipping-container-homes-uk-planning-permission-regulations/ and https://www.sjonescontainers.co.uk/containerpedia/shipping-container-homes-uk-planning-permission-regulations/ - container homes are being promoted as a quicker, less expensive alternative to traditional built brick and mortar houses.

The first article provides a useful definition of container homes stating:

“Container homes are homes made from the large metal shipping containers you see transporting goods on ships, trucks, and trains – or being used to store goods. Shipping containers are designed to travel long distances around the world, and as a result, are made from highly durable materials such as steel. This makes them extremely durable and enables them to withstand wear and tear and remain in excellent condition for many years. Container homes also have significantly lower construction and maintenance costs when compared to traditional homes, which makes them extremely appealing to potential housebuyers.”

There are obvious advantages to using ready-made container homes over having to actually build a house. However, a significant consideration is whether such a move requires planning permission. While the articles above attempt to outline the planning implications, people still come to us, as planning lawyers, for certainty as to whether container homes will deliver what they want: a home in a nice green area and perhaps a reduction of the some of the bureaucracy that comes with engaging the planning system.

To understand how planning controls relate to container homes, it is important to understand some basic planning principles. Planning controls, and therefore the need or otherwise to apply for planning permission, revolve around the concept of ‘development’. If one’s actions constitute ‘development’, planning permission will be required, unless specified exceptions apply. Another important principle is that planning permission can be granted individually, nationally, by virtue of permitted development rights or, less frequently, locally by a development and other types of orders.

‘Development’ is defined as either operational development or a material change of use of an area of land often referred to as a planning unit. Operational development encompasses building, engineering, mining and other operations – building operations being most relevant to this article.

How does this fit in with container homes? If you bring a container home on to your land, have you carried out ‘development’? Not necessarily. It is not usually classed as operational development as you haven’t built anything, nor is the simple act of bringing a container on land materially changing the use of the land. However, things can get complicated and if alerted, the local planning authority - the Council - may want to find out what is going on.

Firstly, there is a chance that the authority will class a container or any other mobile structure as ‘operational development’ if that structure is substantial, has been on (or is likely to be on) the same spot on the land for a long period of time or is physically attached to the land. There is a whole raft of complex case law about this and if this is likely to arise, the situation requires careful assessment by the landowner (or tenant or other occupier) or preferably their lawyers or professional advisers and the Council.

The more common issue revolves around what the landowner does with that container and whether it amounts to a material change of use and therefore development. If the container is used in conjunction with the main use of the land, there is unlikely to be a material change of use and planning permission will not be required. For instance, if a storage container is brought on to agricultural land to store animal feed, produce or medicine, planning permission will not be required. Planning permission will also not be required for a storage container brought on to residential land (or a house and garden) to store gardening or domestic items.

However, if the landowner wants to use the container for a use which is unconnected to the main use of land, the question may arise as to whether there has been a material change of use. An example of this is if someone places a storage container on agricultural land to live in. As the lawful use of the land is agricultural, that person would be introducing a residential use to that land. This is likely to amount to a material change of use, would require further investigation and may result in the need to apply for planning permission.

The person would also need to consider what other work may be required to make the container habitable, like hardstanding to place the container on, or to construct a drive or an earth bund for whatever reason. These may amount to building or engineering works which require planning permission.

The linked articles above also make reference to placing containers in gardens and measurements relating to covering more than half of the garden. This relates to certain procedures and limitations set out national permitted development rights, mentioned above, which the landowner will need to consider before taking advantage of those rights.

The question we often get asked goes something like this ‘I want to bring a container on to the land to live in. What is the best way of going about it?’ The landowner may want to know, having read articles such as the ones above, things like ‘Should I buy this container home? Will it really deliver what I want, which is a cheap, quick home without the hassle of engaging the planning authorities?’

The answer, rather than a quick guarantee over the phone, often includes some of the following: a detailed check about what kind of container you want to buy, what its dimensions are and where you want to put it; the lawful planning use of the land you want to put it in; planning laws regarding the definition of development; a risk assessment relating to planning enforcement, and a review of the planning policies in the area regarding land use, design and sustainability.

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