WCA on ESA interaction with the New Enterprise Allowance

Hi,

Client wants to apply for New Enterprise Allowance. Has also received ESA50 for a review on his ESA claim.

His query is if he applies for the NEA would ESA still be reviewing and assessing his claim in the background? Or would the NEA ‘pause’ his ESA for 26 weeks while he is paid NEA and then the ESA/WCA review process would continue.

My thoughts are that the two are separate and if his ESA claim is due to be reviewed he won’t be able to pause or delay this process with the New Enterprise Allowance. Is this the case?

Obviously if he fails his WCA he can claim UC and I presume still receive the NEA for 26 weeks until it ends and he goes back on JSA.

Thanks

Joel

Anyone got any ideas on this one?

Not come across NEA in any detail before to be honest!

Hi Joel - I don’t really know anything about NEA either but posting a reply in the hope it might encourage others if they know more.

My guess would be that by applying for NEA your client is basically saying that they are fit for work as they’re setting up their own business so the ESA claim would come to an end. So therefore the review process would stop. If he becomes unfit for work again in the future then I think he would have to start the process again ie submit fitnotes in the assessment period and undergo a new WCA. Although if he in on contributory ESA and has a gap of less than 12 weeks between claims he can use the linking rules and therefore carry forward his LCW/LCWRA status into a new claim (see CPAG pg 1021) (and into a UC claim if he has one). But if there is no entitlement to contributory ESA then he cannot benefit from the linking rules as they do not exist in UC.

If he won’t be earning much as he gets started in his business he could claim UC as a top-up.

Could you do the NEA as permitted work and keep the ESA? I don’t know how NEA works at all but it might be worth checking those rules as well perhaps?

‘ESA claimants under permitted work rules are not eligible to participate in NEA
because the starting of a business will not take them off benefit.’

from the provider guidance

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/730083/new-enterprise-allowance-phase-2-provider-guidance.pdf

Vonny - 20 November 2018 01:10 PM

‘ESA claimants under permitted work rules are not eligible to participate in NEA
because the starting of a business will not take them off benefit.’

from the provider guidance

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/730083/new-enterprise-allowance-phase-2-provider-guidance.pdf

Ah, thanks Vonny.

Sorry for late response.

Thanks guys. Yes this isn’t something I have come across before really.

Thanks for the link to the guidance.