The UK government has very quickly identified the impact the Coronavirus may have on business and has provided key reliefs in the 11 March 2020 budget. This includes a package of measures to assist business, including:
- Statutory Sick Pay for those affected by COVID-19 from Day 1 for up to 14 days
- The ability for companies to reclaim such payments arising from COVID-19
- Other benefits for low paid workers
- The availability of a hardship fund
The above should be available to all SME Businesses with less than 250 employees and should enable those businesses to actively participate in the UK strategy of self-isolation and expedite the recovery from the impact of the Coronavirus.
Where businesses have employees who can work from home, such arrangements will be unavailable unless an employee falls sick with this illness and is required to self-isolate.
Further details can be found on the Government website.
However, businesses do have other supports provided in the 2020 Budget, including access to loans to bridge the gap in demand and/or supply that has impacted on their business and other support mechanisms which are developing as this article is written.
With government policy now encouraging employees to work from home – whether affected by the Coronavirus or not – the impact on SME businesses will largely depend on the business’ structure, how adaptable and flexible it and its employees are, and whether the working-from-home approach has a genuine business case.
In terms of liquidity, businesses still do have an ability to look at alternate private sector funding or restricting their business to safeguard the core components – asset based lending is a popular solution to such dilemmas as is the prospect (if serious decisions need to be taken) of safeguarding the core business through finance arrangements or via an administration process which would enable the business to flourish when this pandemic has faded away.
This article represents our understanding of the law in England and Wales as at 17 March 2020. Its contents are not intended to serve as legal advice and should not be considered as a substitute for taking legal advice.