Irish Government unveils “July Job Stimulus”

The Irish Government has unveiled the economic recovery measures it hopes will mitigate the impact the COVID-19 pandemic has on businesses. The “July Job Stimulus” outlines various measures to deliver on the jobs-led recovery strategy designed to feed into the National Economic Plan to be introduced later this year.

The package consists of various business supports including an extension to state wage supports, tax reliefs and employment-related grants to keep as many people in work as possible.

Below, we discuss some of the key employment-related measures.

Changes to wage subsidy scheme

Around 63,000 employers have availed of the Temporary Wage Subsidy Scheme (TWSS) to keep upwards of 626,000 employees on payroll during the pandemic. As a result, it makes it difficult for the Government to halt this supplement overnight.

So, to help businesses return to regular trading levels, a new Employment Wage Support Scheme (EWSS) is being introduced from July 31st until the end of March 2021. The new scheme will run alongside the TWSS until August 31st and will succeed the TWSS which will cease to operate from September 1st.

Under the EWSS, eligible businesses will receive a flat-rate subsidy of up to €203 per employee per week. The exact amount of the subsidy will be based on the employee’s pre-pandemic salary.

The turnover eligibility criteria have also changed. Employers must now be able to show Revenue that their turnover or customer orders have fallen by 30% (up from a 25% decline under TWSS). For reference, Revenue will examine July to December 2020 compared against the same period last year.

While the new turnover criteria may exclude many businesses, qualifying employers will be entitled to rely on the new EWSS to recruit seasonal workers and new hires. Hospitality sector businesses that rely on seasonal staff and may have been closed during lockdown will benefit from this.

Pandemic Unemployment Payment (PUP) to be extended

The Government also confirmed that the Pandemic Unemployment Payment (PUP) will remain available to employees who lose their job due to the pandemic until April 1st, 2021. The PUP will be subject to tapering conditions that will bring it in line with the existing jobseekers’ benefit next year.

The PUP will be available for new claimants from September 17th, 2020 with the maximum payment being reduced from €350 to €300. Employees who earn between €200 and €300 per week will receive a PUP payment of €250 per week. The rate of payment will be reduced again in February 2021 to bring it in line with the standard jobseeker’s payment of €203 per week.

Retraining and upskilling grants

As well as income supports, the Government has committed €200 million in several schemes to help individuals who have lost their jobs to find new ones. The schemes aim to allow employees to retrain or develop new skills that would allow them to take up work in emerging growth sectors.

Recruitment supports your business may be able to avail of include:

  • An Apprenticeship Incentivisation Scheme that provides €2,000 to employers taking on new apprentices.
  • Recruitment subsidies of up to €7,500 over two years to support the hiring of employees aged under 30.
  • The Back to Work Enterprise Allowance and Back to Education Allowance which will be made available to people currently in receipt of the PUP.
  • 10,000 additional work placement and experience scheme places will be available for those unemployed over six months.

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