Financial assistance for employers
An employee's mobilisation may result in additional costs to you. The Reserve Forces regulations, introduced in April 2005, provide a simple and effective scheme for claiming financial assistance to cover the costs of replacing an employee who has been mobilised. In order to claim, you must provide appropriate supporting documentary evidence.
You can view the full copy of The Reserve Forces (Call-out and Recall) (Financial Assistance) Regulations 2005, Statutory Instrument No. 859 of 2005 (SI 2005/859), on the Office of Public Sector Information website at www.opsi.gov.uk/si/si2005/20050859.htm.
What you can claim for
Additional costs - as an employer, you may claim financial assistance to cover the additional costs to you of replacing an employee who is mobilised, over and above their earnings. While the Reservist is mobilised you do not have to continue paying them, and the Ministry of Defence (MOD) will not pay you for doing so. Details of which additional costs you may claim for are included on the claim form.
The additional costs may include, for example:
- overtime if you use other employees to cover the work of the Reservist
- any costs of hiring a temporary replacement that exceed the Reservist's earnings
The maximum amount you can claim for additional costs is currently set at £110 per day, which is roughly equivalent to £40,000 a year. The MOD will pay for every day that your employee is absent by virtue of their mobilised service, and this will normally be paid monthly in arrears.
Non-recurring costs - you may also claim for certain one-off costs that you incur in replacing your employee. These are:
- agency fees, if you use a recruitment agency or employment agency to find a temporary replacement
- advertising costs, if you place a recruitment advertisement by any medium to find a temporary replacement.
There is no cap on the amount you can claim for either of these types of costs, but you must be able to support your claim with invoices or bills.
Training - you can claim if your Reservist employee needs training when they return to work to carry out their duties properly. In order to make this claim you need to be able to demonstrate that the Reservist needs the training as a result of having been mobilised; the MOD will not pay for training that you would have carried out anyway. There is no cap on the amount you can claim for training but you will have to provide evidence of the costs, and show that the Reservist could not reach the required standard by other means, such as workplace experience.
Pension contributions
A Reservist who is called out is entitled to remain a member of their occupational pension scheme. Provided that the Reservist continues to pay their contributions to the scheme, the MOD will pay the employer contributions that you would have made. (Regulation 5 of SI 2005/859 says that the pension scheme administrator cannot refuse to accept the MOD payments.) This payment is made as part of an award to the Reservist - you do not need to claim for it.
What you cannot claim for
Reservist's salary or benefits -you are not under any obligation to pay the Reservist's salary or benefits in kind during the time that they are mobilised. If you choose to continue paying them, you cannot claim for this.
Loss of profits, turnover or goodwill - you cannot claim for these. If you believe that the loss of them will do serious harm to your business, then you should seek exemption, deferral or revocation of mobilisation (See Exemption, Deferral and Revocation).
How to make a claim
If a Reservist employee is mobilised, they will hand you a letter from the MOD, which will provide application details for financial assistance. You will normally be sent or be given a claim form at the same time.
You will need to complete a claim form and provide the evidence that the form describes. Your claim will then be considered by an Adjudication Officer, whose address is on the letter accompanying the form. The Adjudication Officer may ask you to produce additional evidence and if you do not do so, your claim could be delayed, not paid in full, or in certain circumstances not paid at all.
The latest you should normally make any claim, other than for training, is within four weeks of the date your Reservist is demobilised. If you think you will have difficulty in completing the form within that period, you should contact the Adjudication Officer immediately. They might be able to make an interim award based on the information you can provide.
You will need to provide the following information to the Adjudication Officer:
- Your full name and contact details, including your business address, telephone number, fax number and email address.
- Full details for the employee in question, including their full name, National Insurance number and their staff, works or clock number.
- Written evidence of their relevant earnings.
- Written evidence of your replacement costs such as hiring a temporary replacement.
- Written evidence of your one-off costs, such as advertising for a replacement or using an employment agency.
These notes are to help you with the completion of your claim - no claims can be made or submitted on this website.
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