Guernsey Coronavirus Payroll Co-Funding Scheme

Businesses in the sectors listed below will be able to continue to apply for either 80% or 100% of the minimum wage for employees depending on the extent to which the business is impacted. The expectation is that businesses within these sectors that are more reliant on tourist trade will be hardest hit and far more likely to require support over this extended period.

The sectors which will be eligible for support are as follows:

• Retail outlets (excluding essential retail outlets)
• Hostelry (food and drink)
• Hostelry (events, including events providers)
• Travel agents & tour operators
• Arts, entertainment and recreation which act as tourist activities
• Visitor accommodation

Additional financial support for hotel and accommodation providers is now available. More information can be found at https://covid19.gov.gg/guidance/visitor-accommodation 

The States remains open to assessing the need to provide support for those exceptional businesses on the basis operating conditions remain heavily impacted by the border closure. In these circumstances an application for support will need to be made by emailing business.support@gov.gg. It is recognised that income and profit levels may not return to normal levels for some time for businesses within several others sectors, with the expectation that these businesses will determine how best to adapt to the new conditions. Note, businesses clearly classed within another sector not highlighted in the eligible list above will not be able to claim.

Under the basic scheme, the States of Guernsey will help you to pay your employees an amount equivalent to Guernsey’s minimum wage to ensure a level playing field. This is currently set at £8.50 per hour (£8.05 for 16 and 17 year olds). For a 35-hour week, this figure would equate to a gross figure of £298. The States of Guernsey will meet 80% of this figure (i.e. £238 per week based on a 35 hour week). Employers must make up the remaining 20% (equivalent to £60 per week). Employers are encouraged to ‘top-up’ these amounts further if they are able to do so.

Under the enhanced scheme, this is still linked to the minimum wage of £8.50 per hour (£8.05 for 16 and 17 year olds). Support will be calculated based on the normal contractual hours worked by your employee(s) up to a maximum of 42 hours per week. For example, based on a 35 hour week, funding would be £297.50 per week or £1,289 per month.

For business owners and self-employed claiming payroll support, hours that can be claimed are capped at 42 hours of £1,547 per month.

Employers will still be responsible for paying the social security employer contribution of 6.6% but are able to request that this is deferred for both Quarters 1 and 2.

Businesses who have put in an application for or are currently claiming payroll co-funding support who are able to return to some level of activity but are still experiencing a significant impact on their turnover will be able to continue claiming support. Payroll co-funding can still be claimed for all members of staff, including sole traders and business owners. However, as is currently the case, businesses will be asked to declare an estimate of their level of activity relative to normal. The value of the support provided may be adjusted to reflect the increased level of activity in the business.

To be eligible support, businesses must work within the following sectors and have been trading continuously since 1 September 2019:

• Retail outlets (excluding essential retail outlets)
• Hostelry (food and drink)
• Hostelry (events, including events providers)
• Travel agents & tour operators
• Arts, entertainment and recreation which act as tourist activities

Support will be calculated based on the normal contractual hours worked by your employee(s) up to a maximum of 42 hours per week.

To be eligible for payroll reimbursement, you must comply with the conditions below. Employees must:

• be permanent employees,
• be included as an employee in the quarterly employer returns submitted to the Revenue Service for ETI, and
• have been employed by the business before 16 March 2020, or re-employed since that date
• the number of staff should not exceed the number of staff employed in the corresponding period in 2019 (e.g. July 2020 compared to July 2019).

On 15 April 2020, the Original Scheme (the Coronavirus Payroll Co-funding Scheme) was extended to self-employed individuals (whether operating through a company or as a sole trader). These individuals may apply for payroll funding and will be subject to the same eligibility criteria as set out above.

Self-employed business owners must provide the following:

• If a self-employed person is on the payroll of their company, then a copy of the payroll should be submitted with the claim.
• If a self-employed person draws their income from the business, or a sole trader does not have a payroll set-up, then they should submit a claim up to a maximum of their usual level of income.  Applicants are asked to note that there is a cap of 42 hours payment on the amount that the States will reimburse, up to a maximum sum of £1,237.60 per month under the Standard Level and £1,547 for the Enhanced Level.

It will not be necessary to register as an employer and generate payslips or submit quarterly ETI returns in order to be eligible to claim.

As many businesses will be able to engage in normal trading activities within Guernsey, which will provide some income, the payroll support will now be paid monthly rather than weekly.

You will be able to apply for payroll support on a monthly basis for payment of your payroll one month in arrears. This means that for the month of July, you should apply for re-imbursement from 1 August.

You will be able to apply online here: https://covid19.gov.gg/guidance/business/payroll-scheme.

You will need to answer a few questions to check eligibility before your claim can be processed.