Are you a worker who’s fallen between the cracks when it comes to financial help from the government? This is what you need to know

Beyond the immediate threat to health and life, one of Coronavirus’s biggest casualties has been the workforce; hugely denting the livelihoods of millions four out of five people in the UK in a matter of weeks. Millennial women, as we know, have been hit the hardest.

The UK government has responded by handing out one of the biggest financial relief packages and job retention schemes in peacetime, which aims to relieve the financial burden of workers as well as safeguard them from eviction by new renting legislation.

But whilst the rhetoric of this plan sounds inspiring- and the intentions behind it are admirable – just how comprehensive is it? Is everyone looked after?

The government has said ‘no one gets left behind’- but who, in fact, has been left behind? And what can they do?

Anyone who became self-employed in the last 24 months
On 26 March, the UK government announced its plan to help the self employed; it was the largest, not to mention the first, financial aid package offered to this demographic – who happen to be the lowest paid in our country, of which a disproportionate number are millennials.

The self-employed of us will be able to apply for a taxable grant worth 80% of our average monthly profits, up to £2,500 a month.

HMRC will use the average profits from our tax returns in 2016/17, 2017/18 and 2018/19 to calculate the size of the grant. Which means we need to show three year’s worth of earnings to be liable.

That all sounds great- unless you happen to fall outside of the requirements. Like if, for example, you’ve only been freelancing for one year prior to lockdown.

“My boyfriend and I went freelance over the summer,” says Sky Bennington, 26, an illustrator from Manchester, “We are not eligible, as our first tax return will be 2019/2020 and HMRC are not only accepting up to 2018/2019.”

Sky and her boyfriend Ben Sands,30, a fitness instructor, will join the estimated two million self-employed workers who will either be not eligible, or not adequately supported by this scheme.

“We are seeing around seven out of ten self-employed workers still saying they are going to struggle, despite the government’s support,” says Matt Dowling, CEO of The Freelancer Club, an advocacy and support group for the self-employed “That’s on top of the fact that only a third of self-employed say they have enough savings to last them until June.”

Ah yes, because that’s the other thing: the government grant only kicks in in June, leaving millions to fend for themselves before then, or apply for universal credit – social security payments given by the government, otherwise known as benefits.

“We are really trying to get the government to speed up those payments as much as possible, because our community desperately needs them, to pay rent, to live, to feed their families. We need to start paying attention to the real human impact this is having,” says Matt, who describes the self-employed workers waiting until June as “holding on to a tiny twig in a gale-force wind.”

The Freelancer Club, along with twelve other self-employed organisations has just launched a campaign for self-employed income support during Covid-19, which implores the government to reach out to those left behind by the scheme, like Sky and her boyfriend.

“Why not prioritise those first-time self-assessment tax payers and their 2019/2020 tax returns and get them the help they need??” says Matt, who thinks the extra time the government has given to those late on their 2018/2019 tax returns, should be extended to include the 2019/20 tax return that people like Sky and Ben need to access the grant; “Why can’t they include them- the wait and the delay is a real indication that the government’s lack of understanding about the self-employed.”

Matt is hopeful that the campaign will be successful and that the government will start to address the holes in its plan. “I actually hope we come out of this with greater protections and representation for the self-employed,” he says, “I would like that to be a positive legacy of this time.’

Agency Workers
Four supply teachers contacted GLAMOUR this week and became the true inspiration for this story. While we have been praising the amazing work of teachers as key workers during this time, it was shocking to hear that some – employed via agencies and umbrella companies – will be left on 80% of minimum wage at this time, as they discovered they were being paid largely in “discretionary bonuses”- top ups to their payment that the agency were adding, but which actually made up the bulk of their pay.

“I get £20 an hour for my work,” says one, who preferred to remain anonymous, “So, when I was furloughed, I anticipated 80% of my earnings from my agency. It was only then I found out that they would only be giving me 80% of minimum wage. Which, as you can expect, is basically nothing.” In fact, it works out as roughly £250 a week.

I ask Frances Lewis, a lawyer and consultant at London-based law firm
Osborne Clarke what can be done. It was, unfortunately, bleak news.
“Legally-speaking “pay” excludes the discretionary bonus her agency when it comes to being furloughed,” she says, adding that this is the regrettable reality for many agency workers, “Sadly, based on current guidance, workers such as teachers, carers and many nurses who have such arrangements will have no right to insist that the furlough payment should include the bonus.”

While the law is not technically speaking on their side, we are in unprecedented times- a time where the actions of employers will be noted, especially those that feel massively exploitative.

“As an employer myself, I understand employers in this circumstance,” says Deborah Frost, CEO of Personal Group, an insurance and employee-benefits provider which prides itself on catering to those often ‘forgotten’ by the system, “But after this crisis is over, I think it really will come down to; how did we treat our employees, how did we make sure that we genuinely tried to do good? We will be judged on that.”

Deborah agrees however, that the government should be looking at those, like these teachers and other agency workers, likely to be worst affected; “So many people have fallen through the cracks and even the furlough scheme is missing people out and being horribly restrictive.”

Those caught between work on a company’s payroll (PAYE) and self-employment
It’s these nuanced situations that are proving tricky for the government to deal with.
Another teacher (who preferred to remain anonymous) who has a portfolio career, working directly with schools still managed by the Local Authority, doing some work with an agency and other times as a freelancer. Juggling all these roles makes it impossible for her to see where she fits into the government’s scheme. They have strict boxes and she doesn’t fit neatly in any.

“My self-employed work is about 40% of my total income and as it is below the Government’s 50% limit, I get no help from the self-employed scheme,” she says, “I work about 30% for an agency who may furlough me – but at minimum wage- and the other 30% for a special school which is still under the local authority, unlike Academies and Free schools. I will not be able to be furloughed by the special school, due to the authority’s interpretation of the Government guidelines published so far. So I will be left with possibly 80% of 30% of my usual gross income – the gross is not very much at all as it is.”

It’s a very bitter pill to swallow as, as she says “I pay my taxes and National Insurance just like everyone else! Now I have been left behind.”

This is the case for Rosanna, a 26 year-old designer from London who is self-employed but has, at various contracted work throughout the year, been forced to go on PAYE.

“I have too much PAYE work to qualify for the self-employed grant,” she tells me, “But I can’t get furloughed by any of my PAYE work because they are not strictly my employer. I am stuck in the middle and all I can do is get Universal Credit…”

I ask Frances Lewis what people in Rosanna’s situation can do. She offers a little much needed hope…

“The government has made it clear that it intends for any worker who is on a PAYE payroll to potentially benefit from the grant made available under the Job Retention Scheme,” she says, “It will be for whoever operates the payroll to decide whether or not to furlough the worker but there is no reason, in theory, why a person could not be furloughed by more than one “employer”. The worker does not have to be an actual employee but they do have to have been on the company’s payroll on or before 28th February 2020.”

She even adds: “The fact that a person also earns income on a self-employed basis would not disqualify them from potentially benefiting under the JRS.”

Fixed Term Contractors
For many in this situation, thanks to the unprecedented times, their roles will suddenly feel dispensable- and very vulnerable.
This is the case for Michaela Smithson, 25, from London, who was working on a fixed-term maternity cover at a PR firm.

“My contract is due to finish in December so I am 100% eligible for the Job Retention Scheme (to be furloughed); unfortunately, the firm has decided to terminate all their contractors on Fixed Term Contracts,” she says, “In two weeks, I will be without a job and not eligible for the self-employed scheme because I have been on PAYE.”

She notes that, because her husband is a key worker- and still employed- she will not be eligible for Universal Credit, despite the fact that his wage is not exactly liveable for their entire family.

“I am trying to find new employment, freelance or full time, in a job market which is now not employing,” she says, “It is frustrating as it’s totally within the control of my current employer to help, but it is easier for them to cancel the contracts.”

Like many others, Michaela feels abandoned by her employer (who could, but won’t furlough) and not eligible for help from the government.

“We’ve always worked with people who are relatively unprotected, this isn’t new to us,” says Deborah Frost, “One of our main concerns right now is how employers can help their workers during this time and offer them protection. How can the government encourage people to keep their promises and look after people at this time? This is where more work needs to be done.”

Limited Companies
One of the hardest hit from this crisis will be small business owners. Matt Dowling admits that this is the one sector where the government’s claim that ‘it’s complicated’ is actually, kinda true.

“They fall into this truly complex space because it is really hard to find out what your actual wage is- as you pay yourself in dividends,” says Matt.

This is reality for Sam Nicklin, 33, from London whose content-creation business has essentially closed down thanks to Covid19.

“As myself and my business partner operate as a business and under a Ltd company, most of our income is in dividends – a sum you effectively pay yourself as your own boss- which the government are not currently recognising as claimable income,” they say, “We do however take a very nominal amount as salary but claiming 80% on this will not suffice in replacing the sort of income we would expect under normal circumstances and will certainly not be covering the rent.”

Their only option is to furlough themselves and try and survive on what they had. Sam feels abandoned by the government completely.
Deborah Frost, an employer herself, agrees; “There is really no cover for them. This will affect so many people. It may be the end of these businesses and that is heart-breaking because it is not a result of economic mismanagement its completely out of their hands,” she says “I think it will knock a lot of people’s confidence and we may see a real dip in entrepreneurial spirit going forward, which will be really sad.”

Those who are not financially savvy
Finally, it is worth noting that- employed, self-employed or somewhere in between- quite a few of us can lay claim to be in this category. The circumstances which have been created by Coronavirus are confusing and a lot of the responsibility for finding out what we can do, what we are entitled to and what our legal rights are- falls on us. Deborah Frost thinks the real tragedy of this, will be people who may be entitled to money but who don’t understand the system.

“A lot of people are seriously unprepared for this,” she says, “There are so many workers who are vulnerable, people who are not especially financially savvy, who may not have English as a first language. It may just be too hard for them to access financial resources and I’m not sure as a country we do our best to look after them.”

So, in a world where everything seems to be spinning out of control, let us try and do our best to take a little control back and stay as informed as we can. Our only power here is to equip ourselves as much as we can, with knowledge of what we can access right now and raise awareness of those who need help but are currently left behind.