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Furlough Scheme Extension | FAQs for Employers

Furlough Scheme Extension | FAQs for Employers

Date: 18th June 2020 | By: Claire Malley | Categories: Coronavirus, Employment law, Furlough, Health and Safety

flexible furlough schemeOn Friday 29th May, the Government outlined the latest update to the Coronavirus Job Retention Scheme (CJRS), and provided details on the tapering of the scheme which will allow workers to return to work on a part time basis. It will also require employers to contribute towards furloughed workers’ wages after 1st August. The CJRS guidance was updated by HMRC on 12th June, providing further details of the flexible furlough scheme.

Is there a deadline for placing workers on furlough?

The Government have announced that the scheme will close to new entrants from 30 June, and that only those workers who have been furloughed for a three week period before 30 June will be eligible.

This means that, if you have any workers who have not previously been placed on furlough, then the last date to place them on furlough and implement the scheme will be 10 June.

However, this does not mean that only workers who are on furlough on 10 June will continue to be eligible. If you are operating a rotational furlough scheme, or have temporarily recalled workers to work, then, so long as the workers have been furloughed for a minimum of three weeks at any point before 30 June, they will continue to be eligible.

Can I furlough a worker returning from maternity leave after 10 June?

If you have an employee who commenced statutory maternity, adoption, or shared parental leave before 10 June, and will be returning after 10 June, then you still will be able to furlough this employee for the first time and access the scheme.

Is there a limit on how many workers I can furlough at once?

Yes. From 1st July, the number of workers that you place on furlough and claim for in a single period cannot be more than the maximum number of employees you have ever claimed for in a single period ending by 30 June.

For example, if at any point during the crisis you had your entire workforce furloughed at the same time, then you will still be able to place all of your workers on flexible furlough, and have them return to work on a part time basis.

However, if you operated a system of rotational furlough, and never had more than ten workers furloughed during any one period, then you will not be able to claim for more than ten workers during any single period after 1st July. This may mean that you will have to continue rotating employees on and off furlough.

Can I recall employees to work on a part time basis?

From 1 July, you be able to recall employees to work on a part time basis, whilst continuing to be eligible to claim 80% of their pay through the CJRS for the hours they do not work. This will be calculated based on the employee’s usual hours of work in the claim period. You will be responsible for paying employee’s wages whilst they are in work as per their contract of employment.

Employees will still be unable to perform unable to perform any work that makes money for the organisation or provides services for the organisation during hours that you record they are on furlough.

It will be at your discretion as to what working pattern you implement, according to the needs of the business – however, if you would like employees to return to work on days or hours they would not normally work, we would recommend consulting with them regarding the change to their hours, and obtaining their consent in writing.

It would appear that you will still require a written agreement to implement the flexible furlough scheme, and that this agreement should be retained for a period of five years. If an employee does not agree, you may need to place on short time/ lay off if you have the contractual right to do so.

For specific HR advice relating to your business and employees please speak to one of our advisers.

Request your FREE Consultation today »

Will employees still need to be furloughed for a minimum period of three weeks?

Any employees placed on furlough before 1st July will need to remain on furlough for the minimum three week period, even if this means the period extends beyond 1st July. However, from 1st July, employees commencing a new period of furlough can be furloughed for any amount of time. However, claims for payment must be for a minimum seven day period.

Can employees be recalled to work for part days under the scheme?

All reference to the new flexible furlough scheme alludes to an assessment of hours, not days. This would suggest that employees may be recalled to work for part days. We will update you as soon as this has been clarified.

How much will I need to contribute towards wages after 31 July?

To reflect the fact that businesses will be allowed to re-open, and employees to return to work, the Government have announced a tapering of the level of government grant available:

  • 1 August – The Government will continue paying 80% of wages up to a cap of £2500 per month. However, employers will be required to employer’s National Insurance and Pension contributions – approximately 5% of gross employment costs.
  • 1 September – The Government grant will reduce to 70% of wages, up to a cap of £2187.50 per month. Employers will be required to pay employer’s National Insurance and Pension contributions and will be required to make up employee’s wages up to the lower of 80%, or £2500 per month.
  • 1 October – The Government grant will reduce to 60% of wages, up to a cap of £1875 per month. Employers will be required to pay employer’s National Insurance and Pension contributions and will be required to make up employee’s wages up to the lower of 80%, or £2500 per month.
  • Eligibility for the CJRS grant requires that you pay employees at least 80% of their wages, therefore, it will not be possible to agree a further reduction in wages with employees if you are unable to fund the employer contributions.

    If you have any specific queries concerning your business and the Flexible Furlough Scheme that are not addressed above, contact our Employment Law team. Alternatively if you have any questions relating to safety measures, PPE or social distancing measures in the workplace, get in touch with our Health and Safety Consultants today.

    Request your FREE Consultation today »

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