For a many companies these are exceptionally challenging times.
There have been several announcements from both the Department of Finance (Revenue) and also the Department of Employment Affairs and Social Protection (DEASP) in the past 48 hours and below we outline what options are now available.
- Business as usual – employees to be paid as normal and payroll information submitted to Revenue.
- Business has cut back on employees hours substantially – employees can apply for Short Time Work support https://www.gov.ie/en/service/c20e1b-short-time-work-support
- Employees to be laid off (temporarily or otherwise). Employees contract is ceased and the employee applies for Job Seekers Allowance via the DEASP directly – there is a delay in processing and funds being paid(possibly weeks)
- Employees to be kept on the payroll via Employer Covid 19 Refund scheme. Employees contract remains open. Employees apply for Job Seekers Allowance via the DEASP and in the interim are paid €203 by the employer who claims the refund via Revenue. https://www.gov.ie/en/service/6c6582-employer-covid-19-refund-scheme/#employers-paying-full-wages-to-staff
3. Employees Are To Be Laid Off
This is the normal cease employment process, covered in our guides (here):
- Cease the employees contract via Parolla with the appropriate finishing date (this finishing date should be in the current payment cycle)
- If you have already paid the employee their final pay but the finishing date wasn’t included then you will need to reverse and re-submit to Revenue
- Advise your employees to apply for Job Seekers allowance as soon as possible by completing the one page form available at https://www.gov.ie/en/service/be74d3-covid-19-pandemic-unemployment-payment/#apply and sending the completed form to FREEPOST, PO BOX 12896, Dublin
4. Employer COVID-19 Refund Scheme
The purpose of this scheme is to facilitate benefit payments to employee’s and avoid long delays in processing via the DEASP.
The Scheme allows employers to make a payment equivalent to the Covid Unemployment payment (of €203) to workers who are temporarily laid off and are receiving no other wages payment from the employer. Revenue are using their existing infrastructure to fast-track the job seekers payments via the employers software. The employee should still apply for Job Seekers Allowance.
The Employer Covid 19 Refund Scheme is the quickest method of getting the €203 payment to your employees. The Revenue have indicated that refunds will be paid to employers within 48 hours of submission of the payrun to Revenue and that refunds will start from Monday 23rd March.
To Apply for this Scheme
- Send an expression of intent to be part of the Scheme via My Enquiries in ROS
- On the My Services page in ROS go to Payments and Refunds and make sure the account details for refunds are up to date.
- Ensure that all payroll submissions are up to date with Revenue – You must have made a submission to Revenue between 1st Feb and the 15th March 2020.
- Make the employees last normal pay run and contact us to confirm you are availing of the scheme.
- Parolla will create a new Weekly payroll cycle that matches the DEASP benefit cycle.
- The affected employees will be moved to the new weekly benefit payroll.
- All earnings, deductions, benefits should be entered as zero. The business can not make any contribution or top up.
- Add the Benefit type “COVID-19 Refund Scheme” on the payslip – this benefit type will be available from Monday onwards.
- An employees entitlement is for 6 weeks, at which point they should be on the Job Seekers Allowance. However, the period may be extended.
- Revenue will contact you directly to advise when to remove the employee from your scheme payment.
Points To Note
- This scheme does not accommodate top up payments – the payment is for €203 only, as if the employee were receiving the benefit from DEASP.
- The scheme is to be used once the employee is off for a full week. Ie if they worked 3 days the refund will not apply
- Employees may be entitled to a tax refund also. This can be paid to the employee and Revenue will refund the amount with the €203 scheme refund.
- No deductions are to be taken from the €203 payment – ie no cycle to work, travel pass, insurances and pensions or other BIK’s Local Property Tax should should be removed from the payslip.
- Employers apply on behalf of employees – employers should not cease the employees contract
- Employers can claim for some staff and not for others – eg for Restaurants – the chef may be working normal hours but the front of house staff are not.
- Payments are made from Revenue at 2pm on the day after submission if the payment date has passed.
- If you submit in advance – ie submit the payroll on a Monday to be paid on a Friday Revenue have indicated that the refund will arrive on the Friday after 2pm.
Finally, this may all change very quickly, so please keep reading the following sites for updates:
https://www.revenue.ie/en/employing-people/documents/pmod-topics/employer-covid-refund-scheme.pdf
https://www.gov.ie/en/campaigns/4cf0e2-covid-19-coronavirus-information-for-employers-and-employees-test/
https://www.citizensinformation.ie/en/social_welfare/covid19_and_social_welfare.html
https://www.revenue.ie/en/corporate/press-office/press-releases/index.aspx?year=2020
We will be updating our blog posts as things change.
Best wishes to all,
Mark and Claire