In March, as the coronavirus pandemic began to spread across the world, the global stock market crashed. Screaming headlines described the drop as the biggest fall since the 2008 financial crisis. By the middle of the month, the Dow Jones (basically an index of America’s biggest companies), reported their biggest percentage drop since 1987 – a day referred to from the 80s as Black Monday.
But what does that mean for regular people in the UK?
Though stock markets can often seem like little more than ugly graphs on a screen, there’s been a very real world response to COVID-19. Friends and family members have lost their jobs. People are talking about withholding rent payments. What do you even do if you’re self-employed? It’s a confusing time.
In an effort to clear things up, we’ll run through several scenarios below. We'll update this piece as and when the UK government changes their policy.
YOU'RE RENTING AND WORRIED ABOUT BILLS
If you’re renting and can’t pay your bills, don’t fret. The government is encouraging landlords and tenants to come to an agreement, with rent paid at a later date.
Andy Parnell, a housing advisor at Shelter, suggests "suggest contacting the landlord or letting agent to discuss the situation as soon as possible” if you're struggling to pay. That way, the landlord will be able to get in touch with their mortgage lender, who are offering a three month break in payments. If your landlord agrees to deferred rent payments, make sure you get your agreement in writing so it’s clear.
If your landlord doesn’t agree to late payments and you still can’t pay, they cannot legally start eviction proceedings for at least three months – so there is some safety barrier there. But this isn’t ideal, obviously. The best route here is to contact Shelter as soon as possible to discuss your options before you miss any payments.
Lastly, if you can pay your rent – do. I’ve seen a few people on WhatsApp groups who aren’t clear on if rent payments can be delayed or if they never have to be paid. To be clear: they are delayed. If you decide to stop paying rent and haven't agreed anything with your landlord, they can still issue you with an eviction notice. There's just a longer delay before they can chuck you out than BC (Before Corona).
“If the tenant refuses to come to an agreement or to cover unpaid rent by other means once the government’s emergency measures have ended, the landlord will have similar options to recover unpaid rent as they have had previously,” Parnell explains. “This could include, for example, taking court action to claim back unpaid rent or to start eviction proceedings.”
YOU'RE A UNIVERSITY STUDENT
It’s not clear whether university exams will be cancelled, like A-levels and GCSEs. Universities have suspended face-to-face teaching for now, with many being educated via Zoom video link. But what about your rented accommodation? Maybe you can’t pay up or need to leave early to return to your home country? The National Union of Students (NUS) is currently demanding the government act to alleviate these anxieties.
NUS vice-president Eva Crossan Jory says: “We are calling for student landlords to offer a no-penalty release from tenancy contracts to their tenants, an end to evictions and the subsidy, reduction or waiving of rent payments for students impacted financially by coronavirus.”
It's good campaigning from the NUS, but nothing official yet. In the meantime, it's worth checking current employment and rental rights for non-student accommodation, which we've covered in the sections below.
As for student finance, the Student Loans Company told VICE that third term payments will land in your bank account as normal, so no worries there. (If you've already graduated, you might want to check out how you can get money from the SLC through overpayments here.)
There may also be an option for an increased loan payment for students whose families are struggling. NUS National President Zamzam Ibrahim said in a statement: “Where a students’ family income falls significantly in the year of study, they can ask for a reassessment of their student finance if they are not already receiving the maximum levels of support, and so students should contact the relevant student finance agency as they may be able to receive more support.”
A Student Loans Company spokesperson told VICE: “Under the student support regulations, students can apply for their student finance entitlement to be reassessed should their annual family income reduce by 15 percent in the current tax year."
“The current tax year ends on 5 April and based on an average household income of £29,400, SLC would need evidence that the annual family income had reduced by £4,410 in this tax year to be considered for any reassessment."
To apply for reassessment, your parent needs to complete and return the current Gov.uk tax year income assessment form. You can get that here.
YOU'RE FREELANCE AND/OR WORK IN THE GIG ECONOMY
Chancellor Rishi Sunak announced on Thursday that self-employed workers who earn under £50,000 a year can apply for an 80 percent grant (up to £2,500 month), but they need to have been self-employed before April 2019. This is because the monthly grant is calculated from your 2018/2019 tax return (if you were freelance only for that year), or an average across previous tax years.
Those who are eligible for the Self-Employment Income Support Scheme will be contacted directly by HM Revenue & Customs (the same crew who do the tax returns) – though ~helpfully, the government hasn’t said when this will happen. The government says the cash will arrive in June and will be backdated three months to March, meaning there is a potential payout of £7,500 for those in the top bracket.
But what if you need the money now? You can apply for Universal Credit (more on that below) – it’s not a lot, but something. Many banks have also paused overdraft fees (again, more below), while several credit card companies have said they’ll be increasing limits. You shouldn't apply for a credit card unless you absolutely need one and you are confident of being able to pay it back, but it’s something to keep in mind.
The July tax payment for this year has also been deferred to January 2021. So if you’ve set money aside for that payment and are now struggling, using that money could offer some extra breathing room.
What if none of the above applies and you became freelance after April 2019? Right now you’re able to apply for Universal Credit. Which... isn't great, but is currently the best option. Your local council, industry body or trade union may also offer hardship grants – we've listed a few later in on this piece.
YOU'VE BEEN MADE TO LEAVE YOUR JOB
Many workers had already been laid off by panicked employers before the government announced the Coronavirus Job Retention Scheme, which pays 80 percent of employees' wages. Even if the scheme wasn’t in place at the time of your redundancy, you can ask your previous employer if you can be covered – but it's a case of wading through the small print.
The Gov.uk website has said the job retention scheme is for employees who would otherwise have been "laid off". This is different to being made "redundant" – though people in the UK often interchange use of the two terms.
In strict employment terms, when you've been laid off you've been asked to stay at home without pay because there's not enough work. When you've been made redundant, you've been dismissed.
Confused? Matthew Bradbury, employment expert at Citizens Advice, has the following advice:
- Check with your employer – if they said they were "laying you off", did they mean that you were suspended without pay or that they were making you redundant?
- If they say they were suspending you, then you’re still employed and should start getting furlough pay through the Coronavirus Job Retention Scheme.
- If they say they made you redundant, you no longer have any right to be paid because you’re no longer employed.
It's not potentially as bad as it sounds. Citizens Advice are asking those who have been made redundant to appeal against their dismissal and ask to be reinstated. This, they say, is "on the basis that the scheme makes their dismissal unnecessary, since the employer will now be able to pay them 80 percent of their pay while keeping them on as employees".
Essentially, it's up to your employer to make a decision – they can say no. But surely *points all fingers at employers* it’s in your best interest to retain your best workers?
We've seen reports of employees who were able to get their old job back and apply for the scheme through their employer, so it's worth a try.
YOU'VE TRIED ALL THE ABOVE, BUT YOU'RE *STILL* OUT OF WORK AND RECEIVING NO PAY
You can apply for Universal Credit – a payment to help with living costs. This is available to anyone, so long as they have under £16,000 of savings in their household.
If you're single and over 25, you can get a monthly standard allowance of up to £409.89. If you're in a couple and you're both over 25, you can get £594.04. For younger folks, it's £342.72 and £488.59 respectively. There's also the option to apply for housing credit to put toward your rent, but the amount you get depends on your circumstance and where you live. Apply here. If you're successful, you'll get paid in five weeks time.
It's also worth hitting up your local council to see if you qualify for a financial support scheme – you can get more information on this from Citizens Advice and find your council here. In Scotland, you can do this through the Scottish Welfare Fund.
Various industry bodies and trade unions also have crisis grants – Help Musicians, for instance, just launched a £5 million Coronavirus Financial Hardship Fund. Arts Council England have also announced an emergency funding package totalling £160 million – individually, that’s a grant of up to £2,500 for freelancers with a track record in publicly-funded culture.
Various roles are covered under this, including artists, writers, editors, producers and designers. You can find out more here, and the Creative Industries Federation has collated a list of similar schemes here.
YOU'RE SICK OR SELF-ISOLATING
Uh-oh, you've fallen sick and can't work. What do you do?
Your employer will hopefully have a sick day scheme, where you're entitled to a number of paid sick leave days per year. But if they don't, or you've exceeded your allotted amount of leave, you can claim SSP (Statutory Sick Pay) instead. You can also claim this if you're self-isolating because of coronavirus.
SSP is a set payment of £94.25 a week. It's not much, but it's better than nothing. Anyone in full-time employment who earns over £118 a week is entitled to it. You'll need to inform your employer why you're off sick (do this in writing) to get it. More details here.
YOU HAVE A NOW-USELESS SEASONAL TRAIN TICKET
That Oyster card you’re not going to be using while we’re in lockdown? You can get it refunded, as long as it has six weeks remaining on an annual ticket or seven days on a monthly. Head here to get that done. Same goes for season train tickets. Contact your ticket provider (e.g. Trainline if you bought through them), then sit back and wait for the funds to hit.
YOU'RE LIVING IN YOUR OVERDRAFT
Good news: banks might begin to reverse the April changes to overdrafts, which resulted in higher fees for using your overdraft. HSBC customers will be able to use a £300 interest-free overdraft for three months, and Lloyds, Halifax and Bank of Scotland have offered a similar deal from 6th April until 6th July. Barclays, meanwhile, have scrapped all overdraft fees until the end of April.
YOU BOOKED A HOLIDAY OR FESTIVAL TICKET
Ah, fuck my g. I had a nice weekend away to Europe planned – my first non-UK holiday in almost five years – and had to cancel. It sucks having nothing to look forward to for days (?), but let's grin and bear it (and figure out how to get our money back).
The problem is that getting a refund depends where you're going and when. If the UK Foreign Office has advised against travel to where you're going, and at the time you're going, then your airline will likely cancel the flight, in which case you'll be due a refund via the airline. If the airline is being stubborn, and you bought travel insurance BC (Before Corona), you can likely apply for a refund there too, though the small print differs on various services.
If you're heading much later in the year, then a) good luck; and b) there's still hope if you want to cancel. Some airlines are offering no fees on flight changes, like Norwegian, who will waive the flight change fee if you have a booking for international flights made up to and including 22nd March for travel up to and including 30th November 2020. So check with your airline and pray.
Similarly, some hotels and travel firms are being flexible with their cancellation policy, so check with them too.
Festival heads? Unless you bought a policy allowing you to cancel your ticket for a full-refund, it's all down to whether or not the festival goes ahead. Primavera: here's looking at you to decide soon.
Good luck, everyone.