With the Government advising consumers to stay away from pubs, clubs, theatres and restaurants and to embrace social distancing, the Coronoavirus strain is starting to tell on small businesses up and down the country. Businesses have effectively had their income cut off and as the Government has merely advised consumers to stay away, rather than ordered them to shut down, they are left without customers and unable to claim on any business interruption insurance they may carry.
The Coronavirus strain will also be hitting the self employed hard. When they are required to self isolate, in many cases from today because a family member is showing symptoms even if they themselves aren’t, for many this means an end to their income – and that’s if their clients allow them to carry on work in the first place.
The UK budget included changes to Statutory Sick Pay for those who are employed but had nothing for self-employed people who self-isolate, other than to suggest they apply for Employment Support Allowance (ESA) and Universal Credit. ESA and Universal Credit are essentially welfare benefits for those on low incomes and won’t help much – ESA for example pays out £73.10 a week (£57.90 if you are under 25) and while the Government is temporarily removing the minimum income floor for Universal Credit to ease the Coronavirus strain, it’ll probably take you more than 14 days to apply for it.
“Self-employed claimants on Universal Credit who are required to stay at home or are ill as a result of coronavirus will not have a Minimum Income Floor (an assumed level of income) applied for a period of time while affected.”
– Gov.co.uk
It is definitely worth checking if you have insurance (Critical illness, Income protection, PPI, Mortgage payment protection, or Accident, sickness and unemployment). It is also worth checking your Business Insurance policy for the terms of any Business Interuption cover that you may have. However, again for the self employed it’s likely that cover won’t extend to self isolation if you your self aren’t ill and even if it does their may be a lengthy period of time before any insurance benefits start to be paid.
For some, the problem won’t be that they’re self isolating and sick that causes financial difficulties but simply that work dries up and the businesses they normally contract for simply don’t have need of their services. The next few months are going to be difficult for the entire country but for the 4.9 million self employed, including many marketplace sellers, the lack of safety net that comes from employment will perhaps be the biggest Coronavirus strain other than sickness itself.
From yesterday, the Government started a daily Coronavirus briefing and the Chancellor Rishi Sunak is due to unveil a raft of measures to support businesses. The French President Macron has declared that no French business no matter how small will go out of business due to the Coronavirus strain, it would be nice if the UK declared the same.
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