Please find below the most up to date FAQs @ 23rd June 2020.
Contains public sector information licensed under the Open Government Licence v3.0.
Whether you are claiming for employees on the existing Job Retention Scheme or amended Flexible Furlough Scheme, the same rules apply.
Employees must also have appeared on the employer's RTI scheme prior to the 19th March 2020, been included on an RTI submission on or before this date and operate a UK bank account.
Employees returning from a period of family-related statutory leave such as maternity or paternity leave, can be furloughed as long as they were on leave before 10th June and returned after 10th June. The employee must have been included on the Company's PAYE payroll on or before 19th March and the employer must have furloughed other employees between 1st March and 30th June 2020.
Furlough earnings must be calculated by using either their fixed pay or variable pay calculations as per the Job Retention Scheme based on their pay prior to their statutory leave. The Employer cannot claim under the Job Retention Scheme for any employee who is receiving Maternity Allowance whilst on Maternity leave.
To calculate the furloughed earnings for employees returning from sick leave and put straight onto furlough, the Employer must use either the employee's fixed or variable pay calculations as per the Job Retention Scheme based on their pay prior to their sick leave.
For employees returning from unpaid leave or a sabbatical, the Employer must use either their fixed pay or variable pay calculations as per the Job Retention Scheme based on their pay prior to their statutory leave.
There are certain rules that an employer will need to check before they claim for employee pay through the Job Retention Scheme.
1) An employee must have been furloughed for at least three weeks between 1st March and 30th June 2020.
2) The employer had a UK PAYE Scheme started on or before 19th March.
3) The employer has enrolled for PAYE online.
4) The employee has been included on a submitted Real Time Information (RTI) submission on or before 19th March.
5) The employer has a UK Bank Account.
The Government has recognised that it needs to aid businesses with returning employees back to work. Therefore, with effect from 1st July, the original Job Retention Scheme is being amended to allow employees to return to work on a part time basis. Any shortfall in contracted hours are to be paid by the Government up to the limits previously in place under the Job Retention scheme. This is called Flexible Furlough.
Yes, the number of the employees cannot exceed the maximum number of employees claimed for in any previous claim period before the 30th June. Employees that have not been previously furloughed for a minimum of 3 weeks in the period 1st March and 30th June will not be eligible for the amended scheme.
The employer should explain to the employee the proposal for the introduction of Flexible Furlough and the reasoning. Mutual agreement should be reached between the Employer and employee. The Employer should set a date when the situation will be reviewed. The Employer must write to the employee confirming the discussion and agreement reached. The employee should sign to say that they have read and understood the change of employment terms and conditions.
Once agreement is reached, the Employer will need to submit a return to the HMRC for the hours worked by the employee, contracted hours as per the employee's contract of employment and the hours being claimed for under Flexible Furlough.The Employer must keep the records for at least five years.
Prior to the 1st July, the minimum period was 3 weeks and the employees came off furlough if they returned to work. From the 1st July, the furlough period must be for a minimum of 7 days.
Aside from this period, the employees can remain furloughed for as long as the employer needs them to be up to the cessation of the scheme.
No. An employee cannot undertake any work for the Employer during any hours where a furlough claim under the Job Retention Scheme is made. The employee must not be involved in any activity that makes money for the Company or provides services for the Company or any organisation linked to it.
The Chancellor has stated that it is time that the cost of the Job Retention Scheme is shared by Employers.
For employees that are fully furloughed until 31st July,the Employer does not have to contribute any additional monies to pay furloughed employees.
From 1st August, Companies will need to pay the Employers NI and Pension contributions and will no longer be able to claim these costs back under the Job Retention Scheme.
From 1st September, companies will need to pay 10% of furloughed salaries in addition to the Employers NI and Pension contributions.
From 1st October, companies will then need to pay 20% of furloughed salaries plus Employers NI and pension contributions.
The above sums are payable whether the employees are fully furloughed or working under the Flexible Furlough arrangements. When working under Flexible Furlough, the Employer must also pay the Employee for all hours worked.
Employees retain all of the rights that would normally apply under normal employment terms and conditions including SSP, annual leave entitlements,maternity, paternity and adoption rights, rights against unfair dismissal and redundancy payments.
You can make claims under the new arrangement from 1st July. Claims for periods ending on or before 30th June can be made on or before 31st July. Moving forward, Employers can only make one claim to the HMRC per month,and this must be for the full calendar period and not include any time for any hours worked in other months.
You will need the length of your claim period, the different elements of the wages you should include (salary, wages, non-discretionary commission and overtime etc), and the employees' worked and furloughed hours. You cannot claim for any discretionary payments or Benefits in Kind.
Be aware that if you miscalculate the hours worked and the employee works more or less than the claim submitted or you include discretionary payments, you will need to contact HMRC to make an adjustment.
Under the rules from 1st July, you must claim for at least 7 days at a time. The only exception to this is if you are claiming for the start or end of a month and the employee has been furloughed during the month immediately before or after it.
The time period for the HMRC to process your claim remains unchanged. The claim should take no longer than 6 working days after the claim is submitted.
Whilst an employee could technically be allowed to be paid less than the National Minimum Wage whilst being paid 80% of their salary, the minimum rate must be paid for all hours worked by an employee and also for any training carried out whilst they are on furlough.
An employee can undergo training, provided the Employer pays a minimum of National Minimum Wage for the hours spent training. They can also volunteer or work for another employer, if contractually allowed to do so.
If you do allow the employee to work for another employer, make sure that they are made aware that you are their principle employer if you employ them for more hours than any other company.
The employee accrues all holiday entitlement whether they are working or on furlough i.e. a minimum of 5.6 weeks, which can include Public Holidays.
If an employee takes their holiday whilst on furlough the employer must top up the payment to 100% of their contractual pay, which is either the employee's normal rate of pay or 52 weeks average earnings where the pay varies.
Employers can enforce employees to take their annual leave whilst on furlough by giving the employee twice the amount of notice period as the holiday period to be taken i.e. 1 week's holiday = 2 weeks' notice.
If the employees normally take the Public Holidays as leave, then the employer will need to either top up the pay to 100% as above or give the employee the public holiday in lieu.
Employees who are shielding can continue to be furloughed from 1st July, provided that they have been furloughed for a period of at least three weeks between 1st March and 30th June. It is understood that individual letters will be sent to all people that are currently shielding with future guidance on the way forward.
Furloughed employees retain their rights to be paid Statutory Sick Pay (SSP), subject to meeting the eligibility criteria. It is up to the Employer whether they elect to take them off furlough and pay SSP or leave them on furlough at their furloughed rate.
Employees that receive SSP cannot be included on any claim under the Job Retention Scheme and the employer is responsible for paying SSP. Employees that are self-isolating and/or suffering from symptoms of COVID-19 may be eligible for SSP from day 1.
Employers maybe able to claim back SSP under the COVID-19 SSP rebate scheme up to a maximum of 2 weeks.
These employees will be entitled to SSP, subject to the eligibility criteria. The Job Retention Scheme cannot be used for covering short term sickness.
The answers to these questions have been put together using the HM Government's Guidance Notes, published on 12th June 2020.
If you have any questions that we have not covered here or need to ask any specific questions, please do not hesitate to contact us at email@example.com or call us on 01903 754107.