What financial assistance can an employer claim from the Ministry of Defence when one of its employees is mobilised?

The employer of a reservist can recover certain specific costs that it incurs as a result of the employee's mobilisation. Some employers can also claim an employer's payment of up to £500 per month.

The specific costs that the employer of a reservist can recover from the Ministry of Defence (MoD) are:

  • agency fees that are incurred when replacing an employee who is called out (only one-off, non-recurring, agency fees can be claimed if the period of mobilisation began before 27 March 2015);
  • one-off advertising costs incurred when replacing the employee;
  • the cost of paying a replacement for the reservist, calculated as the difference between the reservist's earnings and the daily rate of the replacement (eg an agency worker) or overtime payments or salary increases paid to existing employees (where these are attributable to the reservist's absence), limited to £110 per day;
  • the cost of paying a replacement for the reservist during a handover period, up to five days' pay before the period of service and up to five days' pay after demobilisation (this is available only where the period of mobilisation begins on or after 27 March 2015);
  • the cost of training a replacement for the reservist, up to a cap of £2,000 (this is available only where the period of mobilisation begins on or after 27 March 2015);
  • the cost of providing specialist clothing to a replacement for the reservist, up to a cap of the lesser of £300 or 75% of the costs incurred by the employer in providing the clothing (this is available only where the period of mobilisation begins on or after 27 March 2015); and
  • the cost of training that a reservist has to undertake that would not have been necessary had he or she not been called out, for example a refresher course to update the reservist's knowledge.

The employer cannot claim costs from the MoD that it would have incurred if the reservist had not been called out. The MoD will require documentary evidence of all claims.

In addition to recovery of these costs, small and medium-sized businesses can claim an employer's payment of £500 for each month for which the employee is called out, pro-rated for partial months and pro-rated for part-time employees. The payment is available to businesses with an annual turnover of not more than £25.9 million and no more than 250 employees. It is not available to public authorities.

There are strict time limits on making claims to the MoD for financial assistance. For the costs resulting from replacing the reservist, this is four weeks from the termination of the reservist's call-out. The time limit for the cost of training for the reservist on his or her return to work is eight weeks from the end of the training. In most cases the training must be completed within six months of the reservist returning to work. The time limit for claiming an employer's payment is four weeks from the termination of the reservist's call-out (or from the termination of his or her employment if this is earlier).