Dáil Éireann Debate, Wednesday - 31 March 2021
339. Deputy Richard Boyd Barrett asked the Minister for Finance if companies that operated the TWSS can seek to demand payments from their workforce if their employees were marginally better off in their net take home pay as a result of the way in which the scheme operated; and if he will make a statement on the matter. [16889/21]
View answerThe Temporary Wage Subsidy (TWSS) was in place between 26 March and 31 August 2020 and was introduced as an emergency income support for employees of vulnerable firms whose businesses had been negatively impacted by COVID restrictions and whose turnover had reduced by at least 25% during Q2 while the strictest public health measures were in place. The support was paid via the employer so as to maintain employment links between the employee and employer insofar as was possible and, to that end, the rate of Employers' PRSI was also significantly reduced to 0.5%. The level of income given to each individual employee was based on previous wages received in January and February 2020. Over 66,500 employers received a subsidy under the TWSS with payments worth just under €2.9 billion paid out to a total of 664,000 workers.
The TWSS was intended to facilitate the retention of the employer/employee relationship in relevant cases, thereby supporting the early recommencement of normal business when conditions allowed. There was no distinction made regarding the subsidy amount based on whether the business had closed due to the restrictions brought in by the Government or had continued to trade with employees continuing to work part-time or work full time with similar hours as before the Covid-19 pandemic.
An employer who received TWSS payments under the scheme was obliged to pass on any such payments to its employees. Revenue’s ongoing TWSS compliance programme is specifically examining that employers adhered to that requirement, as well as examining employer/employee eligibility for the TWSS.
The employer was expected to make best efforts to maintain the employee’s net income for the duration of the scheme and the position in relation to the TWSS did not affect any legal obligations that the employer may have to their employee as regards any terms, conditions or entitlements of their employment, including pay, sick pay or pension schemes.
However, the question of an individual’s entitlements and rights in an employment context, the question of what wages an employer would be legally obliged to pay employees in respect of hours worked and the question of an employer’s capacity to pay wages to employees at pre-COVID levels in the light of the impact of the pandemic on the employer’s business, are outside the remit of the TWSS.
As with the decision around whether to avail of the TWSS in the first place, the question of whether an employer would recover amounts from its employees in any particular circumstance is a matter between the employer and the relevant employees. Where an employer takes such steps they are obliged to comply with the formalities of the PAYE deduction system and reflect in their payroll submissions to Revenue the actual position regarding gross and net pay as well as income tax, USC and PRSI deductions for each employee so impacted. These adjustments may materially affect each employee’s end of year position for 2020 and a failure by an employer in any such cases to accurately correct the records would be regarded as a breach of the PAYE Regulations.
