TWSS - no drop in employers income against 2019.

Phibsboro7

Hi I was wondering what happens in the case when an employers income does not drop under the 25%. What happens if the first six months income are more or less the same as the first six months in 2019. The employer genuinely thought there was going to be a drop in income - it just didn't happen that way and it is likely to happen in future periods. However I think the rules were about drops of 25% upto 30th June?


Does anyone have any idea of what would happen to an employee under TWSS? Is the employer required to reinstate the salary for the period without a fall in their income but apply under TWSS for the periods where there is a drop? Is that even possible?

Is the employer required to report the fact its income did not drop in this period. It was specifically asked by the revenue how did it determine it was likely to drop 25% and sent this information on. But was not asked did it experience an actual drop in income?

This may all be cleared up in future. But its a worry for both employer and employee at the moment.

cheers folks.

kennethsmyth

Phibsboro7 wrote: »

Hi I was wondering what happens in the case when an employers income does not drop under the 25%. What happens if the first six months income are more or less the same as the first six months in 2019. The employer genuinely thought there was going to be a drop in income - it just didn't happen that way and it is likely to happen in future periods. However I think the rules were about drops of 25% upto 30th June?


Does anyone have any idea of what would happen to an employee under TWSS? Is the employer required to reinstate the salary for the period without a fall in their income but apply under TWSS for the periods where there is a drop? Is that even possible?

Is the employer required to report the fact its income did not drop in this period. It was specifically asked by the revenue how did it determine it was likely to drop 25% and sent this information on. But was not asked did it experience an actual drop in income?

This may all be cleared up in future. But its a worry for both employer and employee at the moment.

cheers folks.

Two points here.
1. The employer when projecting the 25% drop needs to be reasonable in their basis. If this is so then they are ok but must stop using TWSS once they knew that they wouldnt have the 25% drop. If the basis was not reasonable and it could be seen early on that the 25% drop would not happen then they may be made pay some or all of the TWSS back to revenue.

2. Regarding the employees - twss is not connected directly to them, the twss is between employer and revenue, its just that one of the eligibility factors is that the individual employee should also be eligible. The reality is the employer and employee have a contract that states the gross pay, this should of been paid to them regardless unless there was an agreement with employees that they would take a wage reduction. If the employer did not have a drop in circumstances the right thing would be to make amends for this. If no agreement with employees was made to reduce pay then the employees could take employer to wrc to receive compensation for breach of contract.

Essentially any employee on twss couldnt receive their actual normal gross pay unless they did reduced hours or took a pay reduction as the twss was paid untaxed but part of net pay and the top up amounts could only go to remaining value of net pay due but this was gross and hence taxed so could never add up to normal gross pay.

Phibsboro7

kennethsmyth wrote: »

Two points here.
1. The employer when projecting the 25% drop needs to be reasonable in their basis. If this is so then they are ok but must stop using TWSS once they knew that they wouldnt have the 25% drop. If the basis was not reasonable and it could be seen early on that the 25% drop would not happen then they may be made pay some or all of the TWSS back to revenue.

2. Regarding the employees - twss is not connected directly to them, the twss is between employer and revenue, its just that one of the eligibility factors is that the individual employee should also be eligible. The reality is the employer and employee have a contract that states the gross pay, this should of been paid to them regardless unless there was an agreement with employees that they would take a wage reduction. If the employer did not have a drop in circumstances the right thing would be to make amends for this. If no agreement with employees was made to reduce pay then the employees could take employer to wrc to receive compensation for breach of contract.

Essentially any employee on twss couldnt receive their actual normal gross pay unless they did reduced hours or took a pay reduction as the twss was paid untaxed but part of net pay and the top up amounts could only go to remaining value of net pay due but this was gross and hence taxed so could never add up to normal gross pay.

Many thanks for this very fast and knowledgeable response! Something to think about over the weekend.