What help can unemployed people claim during the coronavirus pandemic?

Tens of thousands of people have found themselves unemployed in the last three months as the labour market suffered hit after hit from the coronavirus lockdown.

UK unemployment jumped by 50,000 to 1.35 million since March, new figures from the Office for National Statistics have revealed. Jobless claims surged by 856,000 to 2.1 million in April compared to the month before, as the number of hours people worked fell sharply in sectors such as hospitality and construction.

Work and pensions secretary Therese Coffey told BBC Radio 4’s Today programme the country should prepare for the unemployment rate “to increase significantly”.

The government’s job retention scheme, which pays 80 per cent of workers’ wages up to £2,500, has been supporting 7.5 million jobs with payments totalling £10bn so far, said chancellor Rishi Sunak last week.

Here are the different types of help you can claim if you find yourself unemployed as the lockdown continues.

If you are a homeowner

In March, the government announced a three-month mortgage holiday for homeowners struggling to make repayments because of the coronavirus outbreak.

You can apply for the three-month holiday with your bank, but according to the Financial Conduct Authority, you must make a formal agreement with your lender to any mortgage holiday before stopping direct debits or standing order.

There are generally two ways to repay the missed payments during the holiday. You can either spread the cost of the missed payments over future monthly mortgage payments, or increase your mortgage term.

If you are a renter

If you rent your home and have lost your source of income, you should speak to your landlord immediately to try and work out a repayment scheme, government guidance says.

Under emergency coronavirus legislation, landlords in England and Wales must give three months’ notice if a repayment plan cannot be agreed to and they intend to evict you.

The same ban on evictions applies in Northern Ireland, where it has been extended from 5 May for another 12 weeks. In Scotland, the law prevents private and social tenants from being evicted for up to six months.

According to housing and homelessness charity Shelter, all court action for evictions is on hold until at least 25 June 2020.

If you’ve been furloughed

Furlough means your employer has put you on temporary leave because of the pandemic, and they can claim 80 per cent of your monthly wages, up to £2,500, from the government’s coronavirus job retention scheme.

The scheme, which was extended until the end of October, is designed to help employers whose business has been severely affected by the lockdown.

You will still be paid by your employer and pay taxes from your income, and you cannot undertake work for your employer while on furlough.

You can check online if your employer is eligible for the scheme. Any employer with a UK payroll and a UK bank account will be able to claim from the scheme.

However, you must have been employed on 19 March 2020 and on your employer’s PAYE payroll on or before that date in order to receive the payments.

If you are self-employed

If your income has been severely affected by the pandemic and you are self-employed or a member of a partnership, you can apply for a grant through the self-employment income support scheme.

This scheme allows you to claim a taxable grant of 80 per cent of your average monthly trading profits, paid out in one lump sum covering three months.

The grant is capped at £7,500. According to HM Revenue and Customs, the scheme is temporary but may be extended. You can check your eligibility for this scheme here.

If you are under state pension age

If you or your partner are under the earliest age you can start receiving your state pension, and you are on a low income or out of work, you may be able to get universal credit (UC).

UC helps you meet your basic living costs. In response to the coronavirus crisis, some changes have been made to the UC system, which includes an increased monthly standard rate. For example, single people aged 25 or over can now claim £409.89 per month instead of £317.82 at the previous rate.

The government also removed the minimum income requirement for claiming UC and increased the allowance for private renters who are struggling to meet housing costs.

You may be eligible for UC if you are aged 18 and over, but under state pension age, you have less than £16,000 in savings, you live in the UK and you currently receive any of the other benefits that UC is replacing and your circumstances have shifted.

Check if you can apply for UC here.

If you are unemployed or work fewer than 16 hours a week

If this is your situation, you can apply for new style jobseeker’s allowance (JSA), which is a fortnightly payment that can be claimed on its own or simultaneously with UC.

New style JSA is a contribution-based benefit, which means you may be able to get it if you have paid or been credited with enough national insurance (NI) contributions in the two full tax years before the year you are claiming in.

In the context of the current pandemic, this means being credited with enough NI contributions in the tax years of 2018 and 2019 to be able to claim this year.

However, if you receive a severe disability premium, you cannot claim new style JSA.

If you are ill or have a disability

If you have a health condition or disability that limits your ability to work, or you cannot work because you are self-isolating from coronavirus you can apply for new style employment and support allowance (ESA).

This is also a fortnightly payment that can be claimed on its own or at the same time as UC. It is also a contributory benefit and the same NI contribution criteria as the new style JSA applies here.

It should be noted that you will need to have a note from your doctor in order to claim New Style ESA. However, you can start making your claim before you have one, and self-certify for the first 7 days if you have only just become ill.