U.K. Government Faces Pressure From Industry on Economic Measures for Freelancers

The U.K. government is facing increasing pressure from the creative industries after it emerged that economic measures set out for the self-employed last week by Chancellor of the Exchequer Rishi Sunak have yawning gaps in them.

The measures may have come as a welcome move for many creative industries workers, but not all are eligible for the benefits. Several workers fall between the various schemes available, including those who commenced self-employment after April 2019, recent graduates, those paid in dividends, temporary workers, and short-term contractors on pay as you earn plans.

Under the coronavirus job retention scheme, self-employed individuals can claim 80% of their average income over the last three years up to £2,500 ($3,000) a month. To be eligible, they must earn more than 50% of their income from being self-employed, have trading profits of less than £50,000 ($61,000), and have a self-assessment tax return for 2019. The taxable scheme will begin from June and payments will be backdated to March 1 with applicants being paid for three months in one go. The scheme will last for at least three months, with an option of extension. Those with an immediate need for finances can access Universal Credit or a business interruption loan.

The online service used to make claims will not be available until the end of April.

Liz Tucker, chair of Women in Film and TV, U.K., has written to the Chancellor, Treasury committee and the department for digital, culture, media and sport to ask them to provide support for three freelance groups that have been overlooked – those working through their own limited companies, those with less than than three years of tax history, and those earning more than £50,000 ($61,000) annually.

Entertainment industry union Equity has drafted a letter and asked their 47,000 members to submit it to their respective members of parliament. The letter identifies as many as eight categories of self-employed people not covered under the government schemes. They include parents and carers; workers who fall below the 50% of the self-employed income threshold; new graduates and new entrants into the industry; non U.K. nationals; limited companies and personal service companies; income fluctuations across three years of self-assessments; deaf and disabled workers; and those with expenses that have impact on their profits. Equity has also offered the government possible solutions to the issues.

Meanwhile, as further details have not yet been published and the scheme hasn’t become law yet, there is a fair amount of confusion about eligibility criteria. This past weekend, media industries union conducted a survey of its members on these measures. Some 1,900 members responded and 47% of them feared that they do not expect to be eligible for support through the job retention scheme. The scheme is open to all U.K. employers that had created and started a pay as you earn payroll scheme on Feb. 28,  2020.

Bectu is also looking at the issue from an employer’s perspective to make the process easier for the self-employed. The union is writing to production companies and asking them to furlough workers using the coronavirus job retention scheme. Under the scheme, employers can claim 80% of furloughed employees’ (employees on a leave of absence) usual monthly wage costs, up to £2,500 ($3,000) a month. Bectu is also asking production companies to retain staff where possible and avoid unnecessary contract terminations and compensate crew hired on daily contracts in line with those who are on weekly contracts.

Head of Bectu Philippa Childs said: “Bectu is aware that there are many gaps in government provisions for de facto and the self-employed. Many people on fixed-term contracts are looking for clarification and guidance from the government about how they can be furloughed as the coronavirus job retention scheme is currently their only option for financial support.”

“Bectu is making representations to the Treasury that it must quickly update its guidelines to ensure that those who weren’t on a company’s payroll on Feb. 28 are covered,” Childs added. “The Treasury should make it clear that these workers can and should be re-hired and furloughed by their last engager – even if this was before the Febr. 28 cut-off date. It also needs to make the funds available for companies that are furloughing before the end of April as well as insisting employers furlough people rather than allowing them the choice.”

Following the Bectu survey, member of parliament Tracy Brabin has also written to Sunak.

Another union, the Creative Industries Federation, has been in constant touch with the government. It too conducted a survey on the situation that ends today. Results will be compiled and fed back to the government, thus adding to the existing pressure.