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Coronavirus - the self-employed need urgent support too

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We’re glad the government has agreed to help fund wages for employees, but what about the millions of self-employed who also face collapsing earnings?

Following intensive negotiations with the TUC and unions, the government last week announced an urgent package of measures to support workers through the coronavirus crisis.

Its new job retention scheme, which provides wage support to employees who are temporarily laid off due to coronavirus, was a big win for the union movement.

The government has promised to pay 80% of workers’ wages to avoid employers letting them go, so there’s no excuse for mass redundancies.

But while this is an important breakthrough, it’s not enough.

Friday’s announcement will mean a lot to any employee whose job is at risk, but the lack of support for the millions of self-employed workers in the UK and the lack of action on statutory sick pay (SSP) were both big disappointments.

We also still need to see a wider package of support for household finances, and clarity over whether the job retention scheme is available to parents and carers who need time off to care for children.

Read our full report on fixing the safety net for every worker here.

Supporting the self-employed

More than five million self-employed people aren’t covered by the government’s job retention scheme.

And the measures announced last week, which include delaying the next self-assessment tax payments and ensuring that self-employed people on low incomes can access up to £94 a week through the benefits system, are clearly not good enough.

It’s not right that employees are getting so much help from government while self-employed workers lack proper income support.

We strongly support the Federation of Entertainment Unions calls for a guaranteed minimum income to support self-employed people during these troubling times.

There are two ways this could be delivered:

  • Guarantee self-employed people a significant percentage of their income based on their last three years of self-assessment income
    The best way to support the self-employed would be to put in place a scheme mirroring the support for employed workers – guaranteeing at least 80 per cent of income up to a maximum of £2,500 a month. Norway has already extended its job retention wage subsidy to the self-employed, so there’s no reason it can’t be done here. Grant payments could be made to self-employed people using their self-assessment tax details.
  • Provide a flat-rate payment to all self-employed people affected by coronavirus.
    Another way could be to provide a flat-rate payment to all self-employed people affected by coronavirus. We believe this should be based on the equivalent of 35 hours work at the National Living Wage, or around £325 a week.

Increase and extend statutory sick pay

Last week health secretary Matt Hancock confessed on BBC Question Time something we’ve known all along: Statutory Sick Pay (£94.25 per week) in the UK is not enough to live on.

On top of that, far too many people aren’t eligible because they’re self-employed or don’t earn enough to meet the eligibility requirements.

That’s why the TUC launched the #SickPayForAll campaign right at the beginning of this crisis.

We’re calling for the government to increase the weekly level of sick pay to the equivalent of a week’s pay at the Real Living Wage. This would make statutory sick pay £326 per week.

The government also needs to act now to remove the lower earnings limit for qualification for sick pay so that everyone can access it, no matter how much they earn.

Support parents

It’s not yet clear whether the job retention scheme can be used to support parents who need to stay off work due to school closures.

As the scheme is linked to a reduction in business demand, rather than absence for other reasons, there’s doubts about whether this scheme would help them.

If it doesn’t apply, the government needs to introduce guaranteed paid parental leave for one primary carer for the duration of the school and nursery closures, with government reimbursement for employers.

This must be accompanied by protection from unfair treatment or dismissal for parents who take up this leave, no matter how long they’ve worked in their jobs.

A wider package of support

With significant drops in income likely during this crisis, the government needs to work with unions, employers and civil society to design a wider package to help household finances.

The measures we’d like to see include a fully-funded freeze on council tax, as well as council tax debt repayments, a significant increase in the hardship fund for local authorities, a further immediate increase in social security payments and an end to the five-week wait for universal credit.

It’s also clear that we need much better support put in place for renters.

Protect every worker

While last week’s measures by the government were a real step forward, progress for the self-employed and those who don’t get sick pay has been too slow.

Both groups of workers are right to ask why they haven’t had as much help from the government as others.

So now is the time for ministers to act again. They must urgently extend support to the self-employed, fix our broken sick pay system, help out parents, and boost household finances.

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