The UK Government's emergency powers to respond to the Coronavirus pandemic are, at least in part, expected to become effective before the end of March. The draft Coronavirus Bill (the "Bill") is being fast-tracked through Parliament with the effectiveness of some provisions starting earlier than the end of the month. The Chancellor also recently pledged to reimburse 80% of wages for non-working employees. Businesses and employees now have more insight into aid available to them during the pandemic as well as comfort that the Government is able to respond effectively to the crisis. We have set out a brief overview of the potential impact of these developments on:

  • Employers and employees;
  • Events, gatherings and premises;
  • Tax;
  • Government Support for UK businesses;
  • Government powers relating to detaining potentially infectious persons;
  • The UK's legal system; and
  • Key sectors: healthcare and food.


Employer and employee provisions

- Job retention scheme

The Chancellor has announced a support package to avoid employee redundancies. While details are yet to be made available it is expected to be open to all employers. It is designed to cover the wages of people who are "furloughed" (i.e. not working) due to the business impact of the coronavirus pandemic. It provides a grant of up to 80% of an employee's salary (subject to max of £2,500 pcm) and will be backdated to 1 March 2020. The aim is that these grants will enable businesses to furlough their staff rather than make redundancies. Provisions will be in place for an initial three months with the option to extend them. It will be operated by HMRC and the Government expects the first payments to be paid within weeks. It is expected that businesses will need existing contractual powers to furlough their staff, or will have to negotiate such arrangements.

- Emergency volunteering leave (EVL)

With the health and social care system under pressure, the Bill (amongst other things) gives employees the right to take up to four weeks' unpaid leave to volunteer with local authorities or the National Health Service. To encourage take up, the Government has indicated that it will set up a scheme to compensate volunteers for "some" loss of income and expenses incurred, although the rate has yet to be confirmed. Setting the rate at an acceptable level will be a critical factor to the effectiveness of this measure in uncertain times. The four-week limit recognises that the employer will have workforce planning issues of its own. For this reason, microbusinesses with fewer than ten workers are exempt from these new rules. As further encouragement to take EVL, staff who do are expressly entitled to return to their same job afterwards, with seniority preserved. It will be unlawful to dismiss them or subject them to a detriment for having taken, or sought to take, EVL. The Bill's protections extend to pensions, covering scheme eligibility, accrual and the amount of benefits and contributions.

- Statutory sick pay (SSP)

The Bill contains an extension of statutory sick pay for coronavirus-related absences although again the details are yet to be confirmed. In broad terms, SSP will be payable from day one (rather than the usual day four) for people unable to work where this is related to coronavirus. As well as people who have symptoms, or suspected symptoms, of COVID-19, we believe these rules will also apply to people who are well but who can't work due to self-isolation following government guidance. In addition, there will be a scheme to support employers with fewer than 250 employees, reimbursing them for SSP paid for coronavirus-related absences. The exact mechanics are unclear although the Bill envisages that reimbursement could potentially be in advance or arrears, or offset against payments due to HMRC.

Events, gatherings and premises

Once the Bill is in force the Secretary of State (and corresponding officials in Scotland, Wales and Northern Ireland) will have extensive emergency powers to restrict or prohibit specified events or gatherings and close any premises or impose restrictions on persons entering or remaining in the premises. The Bill introduces a criminal offence (punishable on conviction with a fine) for any individual or body corporate (such as a company) that fails to comply, without reasonable excuse, with any order restricting events or premises introduced by the Secretary of State. The provisions are not restricted to UK nationals or businesses; accordingly, businesses will have to pay particular attention to the restrictions introduced and ensure compliance.

The emergency powers can only be exercised after the Secretary of State (or corresponding official) makes a declaration that the coronavirus constitutes a serious and imminent threat to public health and the powers are an effective means of containing that threat and facilitating the most appropriate deployment of medical or emergency personnel and resources. After a declaration is made, the Secretary of State (or official) may issue a direction prohibiting, or imposing restrictions on, any event or gathering or premises in the UK. The restrictions can be imposed on a specific event, or an event following a particular description (e.g. by reference to number of attendees) and includes the power to close premises. The restrictions apply only to the organisers of the event and owner or occupier of any premises for the event, they do not apply to participants. Moreover, the Secretary of State also has a standalone power to close or restrict departure from any premises in the UK. For these purposes, premises includes any place, including any movable structures, vehicles, train, vessel or aircraft.


Whilst the Bill is largely silent on UK tax provisions, the Chancellor has set out a package of temporary measures relating to UK tax to support people and businesses during the period of disruption caused by the virus. As part of these measures, UK taxpayers that have outstanding UK tax liabilities may be eligible to receive support with their tax obligations from HMRC by calling the dedicated COVID-19 helpline on 0800 0159 559. In addition, the Government announced that VAT payments between 20 March and 30 June 2020 will be deferred and, for self-employed individuals, income tax payments due in July 2020 under the self-assessment system will be deferred to January 2021. These measures will be automatic and no application will be required.

The Government also introduced a business rates holiday for businesses in retail, hospitality and leisure sectors in England, Scotland and Wales for the tax year 2020-21. This would cover, amongst other things, shops, restaurants, cafes, bars, cinemas, music venues and hotels. All businesses in Northern Ireland will pay zero business rates for the next 3 months.

Cash grants will be made available to businesses in the retail, hospitality and leisure sectors. The amount of grant will be up to £25,000 per property for businesses in these sectors with a rateable value of between £15,001 and £51,000, or up to £10,000 for businesses with a lower rateable value. In addition, a one-off grant of £10,000 will be provided to eligible small businesses that already pay little or no business rates (because of small business rate relief, rural rate relief and tapered relief) to help meet their ongoing business costs.

Government Support for UK businesses

In addition to the measures outlined above, the UK Government has been quick to respond to the economic disruption caused by the coronavirus outbreak and has sought to assist UK businesses in their attempts to withstand the adverse economic impact of the crisis. The Chancellor of the Exchequer, in conjunction with the Bank of England (BoE) and HM Treasury (HMT), has established several relief programmes or packages to address this. The two key measures which have been introduced to date are the Covid Corporate Financing Facility (CCFF) and the Coronavirus Business Interruption Loan Scheme (CBILS). Both of these measures are evolving and further details regarding how each scheme will operate in practice and the procedure for applying for and obtaining relief are emerging on a daily basis.

The Chancellor of the Exchequer unveiled stimulus measures specifically aimed at providing financial relief to large companies facing Covid-19 related disruption to their supply chains and cash flow on Tuesday 17 March. The CCFF, administered jointly with HMT and the BoE, has been established for the purpose of injecting capital into large UK based businesses through the purchase of commercial paper of up to one year maturity. These capital injections will be made by Covid Corporate Financing Facility Limited (the Covid Fund) which is managed by the BoE on behalf of HMT. The terms on which the commercial paper is purchased by the Covid Fund from eligible issuers will be comparable to the financing terms which prevailed in commercial paper markets immediately before the Covid-19 outbreak. In order to be eligible for financial assistance from the Covid Fund, the relevant issuer will need to be a UK incorporated business which has genuine business operations in the UK and contributes towards economic activity in the UK (this includes foreign incorporated holding companies which have a UK incorporated subsidiary). The BoE has confirmed that factors which will assist in determining whether a business will constitute an eligible issuer for the purpose of the CCFF scheme include the number of UK based employees, the amount of revenue generated in the UK and the extent of the UK customer base. If applicants satisfy the criteria and are eligible issuers, the Covid Fund will be able to purchase sterling denominated commercial paper on specific terms which include, among others:

  • the term of the commercial paper ranging from between one week to 12 months from issue;
  • the issuer has either: (i) a short term credit rating of A-3/P-3/F-3 from at least one of the credit rating agencies as of 1 March 2020 or (ii) a long term credit rating of above BBB-/Baa3/BBB- on the same basis; and
  • the commercial paper is issued on market standard terms and does not contain any unusual features such as subordination or an ability to extend maturity.

Clearly, not all UK businesses will satisfy the eligibility criteria for assistance under the CCFF relief programme. For this reason, the UK government, via the British Business Bank, has also introduced a Coronavirus Business Interruption Loan Scheme (CBILS) which is available from the week beginning 23 March 2020. This is a government guarantee scheme which is designed to encourage lenders to continue to provide finance to UK-based small and medium sized businesses during the Covid-19 outbreak. Under this scheme, certain accredited lenders will be offered a government backed guarantee as credit support in respect of new or outstanding loans of up to £5m. Under the CBILS guarantee 80% of the borrower’s liabilities in respect of the facility will be guaranteed by the British Business Bank. This is designed to increase liquidity available to small businesses in circumstances a lender would not otherwise be willing to provide funding on account of the limited credit support which the borrower is able to provide. The UK government has also sought to minimise finance costs for small and medium sized businesses by covering the first twelve months of interest payments under facilities which benefit from the CBILS guarantee. In order to be eligible for assistance under the CBILS relief programme, an applicant will need to satisfy various criteria, including, among others:

  • it is a small or medium sized enterprise (SME) which is UK based in its business activity and with turnover not exceeding £45 million per year;
  • it operates within an eligible industrial sector (which excludes certain fishing and agricultural businesses, banks, building societies, insurance (but not insurance brokers), reinsurance, primary and/secondary education, trade unions and religious/political organisations); and
  • it has prepared a borrowing proposal that, if it were not for the current pandemic, would be considered viable by the accredited lender and the accredited lender believes that the provision of the finance will enable the business to trade out of any short to medium term difficulty.

SMEs can take advantage of the CBILS relief programme by applying to an accredited lender in the usual way that it would apply for a loan facility. Where a SME is in a position to make a successful application for a loan facility but for the fact that it is unable to provide the level of credit support which is required as collateral for its borrowings, an accredited lender will be able to turn to the British Business Bank for the enhanced level of credit support which is provided to it in the form of the CBILS government guarantee.

Dealing with infectious people

Public health officers, police constables and immigration officers will have additional special powers to deal with any potentially infectious persons during the 'transmission control period'. If the official reasonably suspects that a person is potentially infectious, they can direct or remove that person to an assessment place, where the person may be required to remain for up to 96 hours, to provide biological samples and answer questions about their health, travel history, recent contacts and other relevant matters. If the test is positive, inconclusive, or if the official still reasonably considers the person potentially infectious, the official may restrict the person’s movements, activities and contact with others and require self-isolation at a specified place for a specified period not exceeding 14 days (with a possible further 14 day extension). The public official can enforce self-isolation if the potentially infectious person is not co-operative. Lack of compliance with any directive, restriction or requirement is a criminal offence. The provisions apply to any person, regardless of nationality.

UK legal system: virtual courts and tribunals and national security measures

- Courts and tribunals

The English courts and tribunals have started to shift their entire operations from the physical to the virtual, in response to the operational difficulties caused by the coronavirus outbreak.

The Lord Chief Justice recently issued guidance to the judges in the Civil and Family Courts explaining that the rules applicable to both courts are flexible enough to enable video and audio hearings of almost everything. The default position now must be that (where possible) hearings should be "conducted with one, more than one or all participants attending remotely". Sensible precautions are advised where physical hearings need to be held (such as applications for breach of an injunction or undertakings). In a similar vein, the Business and Property Courts of England and Wales issued its (revised) Protocol Regarding Remote Hearings explaining to its users how remote hearings are envisaged to function. For example while court buildings currently remain open, the objective is to undertake as many hearings as possible remotely so as to minimise the risk of transmission. The remote hearing will be recorded by the judge’s clerk, a court official or by the judge, and will be made open to the public, if technically possible.

However, certain moves to a virtual platform require legislative action, particularly those relating to criminal proceedings, hence the amendments proposed in the Bill. The guidance to judges and the proposed amendments in the Bill make clear that the UK Government intends to ensure that the courts and tribunals continue to function providing access to justice to all in these unprecedented and difficult times.

- National security

New measures will ensure the relevant law enforcement agencies are able to maintain their ability to protect national security and decrease the judicial approval timeframe during the crisis. The Investigatory Powers Act 2016 ("IPA") creates a procedure for urgent warrants designed to protect national security. A warrant sought under the IPA must be 'double-locked' or signed by the relevant Secretary of State and then approved by a Judicial Commissioner. The Bill allows the Home Secretary, at the request of the Investigatory Powers Commissioner, to vary the appointment process for Judicial Commissioners and to vary the time period for urgent warrants, extending a warrant's lifespan from five to 12 working days.

Key sectors

- Food supply

The Bill gives the Government the ability to obtain the required information to build a clear understanding of the situation in the food industry and allow it to plan for and respond to food supply disruption. Currently, information on food supply disruption is provided by the industry voluntarily. The Bill grants the Government powers to request information to mitigate disruption but these powers are only intended to be used as a last resort i.e. if information is not provided when requested, or is false or materially misleading.

The definition of food supply chain is wide-ranging and applies to any person in the food supply chain or closely connected to it in England, Wales, Scotland and Northern Ireland. Its application extends beyond producers, distributors or retailers including those, for example, that supply seeds, equipment or fertiliser. The Bill does not apply to individuals such as individual farmers and sole traders. There are additional provisions in the Bill to enable relevant authorities to disclose the information they receive to one another and to others (on an anonymised basis, where the recipient is not a government authority). Failure to comply with these provisions can result in a penalty of up to 1% of a company's turnover.

The Bill also provides the Government with further powers which may impact those in the food industry. For example, the Government can restrict access to premises or suspend port operations. However, it is unlikely that those in the food industry will be materially affected by these provisions, given that part of the focus of the legislation is to reduce disruption to the food supply chain as much as possible.

- Healthcare

Emergency registration of health professionals: the Bill will enable emergency registration of healthcare professionals (which is widely defined)1 if the Secretary of State has advised that an emergency has occurred, is occurring or is about to occur and that person is considered to be a fit, proper and suitably experienced person to be registered. Similar provisions have been put in place in Scotland and in Northern Ireland. As outlined in the Government’s Impact Assessment, these provisions are hoped to strengthen the ability to deliver essential healthcare services during this emergency period.

Mental health and mental capacity: temporary modifications to mental health and mental capacity legislation will be introduced. For example in England and Wales, a number of amendments to the Mental Health Act 1983 are proposed, which include, allowing fewer healthcare professionals to undertake certain functions (such as considering applications for compulsory admission to hospital for assessment or treatment), and extending or removing time limits relating to detention and transfer of patients. For prisoners, flexibilities proposed under the Bill will change the number of medical practitioners' opinions and time limits required for detention and movement between court, prison and hospital. Similar provisions are introduced for Scotland and in Northern Ireland. The changes are aimed at addressing the likely increase in both the demand for mental health services during this period and higher staff absences. The Government acknowledges that these measures decrease the immediate safeguards around these processes but argues that this is balanced with patients’ interest of being able to access treatment if required.

Health service indemnification: the Bill introduces an indemnity clause, under which an appropriate authority may provide an indemnity in respect of a liability in tort arising out of or in connection with a breach of duty linked to NHS activities carried out in response to a coronavirus outbreak. The Government anticipates that the vast majority of persons carrying out activities in connection with the provision of NHS services will be covered by pre-existing arrangements.

NHS Continuing Healthcare assessments: protection of public health. NHS providers may delay undertaking the assessment process for NHS continuing healthcare (NHS CHC) until after the coronavirus outbreak has ended. NHS CHC covers free social care arranged and funded by the NHS for people with long-term complex health needs. NHS CHC assessments can however delay hospital discharge and require significant input from NHS and local authority employees. The delay of the assessment is aimed at ensuring that the NHS can maximise the use of both its staff and hospital space. As outlined in the Government Impact Assessment, this will enable patients to leave hospital quickly and with the minimum administrative burden. It should be noted that, pending CHC assessment, individuals would continue to receive NHS funded care.



1Health Professions Order 2001 refers to people of a "relevant profession” which includes: therapists; chiropodists; clinical scientists; dietitians; medical laboratory technicians; occupational therapists; orthoptists; paramedics; physiotherapists; prosthetists and orthotists; radiographers; and speech and language therapists.

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