Coronavirus update for construction: 8 June

The Treasury has announced that the introduction of Reverse Charge VAT will be delayed for a further five months until 1 March 2021. An action within the Construction Leadership Council (CLC) Roadmap to Recovery, the delay was called for by a coalition of industry bodies, including Build UK, and is welcome news for the industry.

From today, new quarantine rules apply for those entering the UK and individuals will have to self-isolate for 14 days on arrival. There is a list of very specific roles that are exempt, including road hauliers; those carrying out essential emergency and maintenance work on water, sewerage, electrical or rail networks; and workers with specialist skills that ensure the continued production of goods. Those who live in the UK but travel overseas for work at least once a week will also be exempt.

The government has confirmed that the Coronavirus Job Retention Scheme will close to new entrants from 30 June 2020, and this Wednesday 10 June is the final date by which an employer can furlough an employee for the first time in order for the minimum three-week furlough period to be completed by the deadline.

From 1 July, ‘flexible furloughing’ will allow employers to agree any working arrangements with previously furloughed employees:

• Eligibility – Employers will be able to continue to furlough any employee who has been furloughed for a minimum of three weeks prior to 30 June, even if they are not furloughed on this date
• Paying Wages – Employers can bring furloughed employees back to work for any number of hours/shift pattern. Whilst employers will be responsible for paying their wages while in work, they can continue to claim for the hours employees are furloughed. From 1 August, the level of Government grant will be slowly tapered and employers will be required to contribute so that employees continue to receive 80% of their salary, up to £2,500 per month
• Minimum Claim Period – The minimum claim period will be reduced from three weeks to one week, allowing employers to decide on a weekly basis whether they have enough work to bring back a furloughed employee and, if so, for how many hours. Employers will be able to ‘mix and match’ and have an employee back full time for a week and then furlough them again the week after
• Maximum Number – Employers will only be able to furlough a maximum number of people equal to the highest number they have furloughed at any one time from March to June. For example, if an employer furloughed a total 10 employees until 30 June, but only five at a time, then from 1 July they would only be able to furlough five employees at any one time.

Further information is due to be published on 12 June, including an online calculator to work out weekly hours worked.

The new Trade Credit Reinsurance Scheme will provide £10bn of government guarantees to trade credit insurance, to stop cover being withdrawn or premiums increasing to unaffordable levels, which could cause serious issues for liquidity and working capital across business supply chains.

The scheme will be delivered through a reinsurance agreement that is open to all insurers currently operating in the UK market, covering both domestic and overseas trade with payment terms of up to two years. It will require participating insurers to comply with certain undertakings regarding the conduct of their business, including forgoing profits and not paying dividends or bonuses for senior staff. The scheme is available on a temporary basis for nine months, backdated to 1 April 2020 and running until 31 December 2020, with the potential for extension if required.

Build UK Trade Association Member, Finishes and Interiors Sector, has provided information regarding an employer’s liability and the role of employers liability insurance in the event that an employee contracts coronavirus.

Build UK Chief Executive Suzannah Nichol will be joining a Building webinar tomorrow from 2:00pm – 3:00pm to discuss the CLC’s Roadmap to Recovery and you can register online now.

Businesses should continue to follow the most up-to-date government guidance and for the latest updates please follow Build UK on Twitter and LinkedIn. If you have any construction-specific queries or feedback on what is happening within the industry, please contact Build UK.