FURLOUGHED WORKERS & THE CORONAVIRUS JOB RETENTION SCHEME – FAQ’s
Updated 04.06.2020
Ahead of the update due today (12th June 2020) from the Chancellor, we wanted to ensure you had the latest information in relation to the Job Retention Scheme to help you understand any further changes that may be announced, and how they may affect your business, or you as an employee.
This update reflects the announcement by Chancellor Rishi Sunak on 29th May and highlights the main changes to the Job Retention Scheme.
- Any employees which businesses wish to place onto the Furlough Scheme must be finalised by 30th June 2020, after this date the scheme will be closed to new applicants.
- During June and July the scheme will continue in it’s current form with government funding 80% of wages (capped at £2500) plus employer National Insurance Contributions and Pension Contributions.
- From 1st July employees on the Furlough Scheme can be brought back into businesses on a part time basis. Furloughed employees will be paid in full for the hours worked, proportional to the hours not worked.
- From 1st August and for the month of August government will no longer pay National Insurance Contributions and Pension Contributions, this will become the responsibility of the employer.
- From 1st September and for the month of September government will reduce their contribution to 70% and reduce the cap to £2,187.50 with the employers continuing to pay National Insurance Contributions and Pension Contributions plus the 10% to make the total wages contribution 80% and the cap to £2500.
- From 1st October and for the month of October government will reduce their contribution to 60% and reduce the cap to £1875 with employers continuing to pay National Insurance Contributions and Pension Contributions plus the 20% to make the total wages contribution 80% and the cap to £2500.
This move towards more ‘flexible furloughing’ is seen as we move into the next phase of the Job Retention Scheme, further details will be released by the Chancellor on 12th June 2020.
The table below contains guidance that has not been updated since 17.04.2020, this information is still relevant and useful for businesses or individuals affected by the Coronavirus Job Retention Scheme in the UK.
Chancellor of the Exchequer Rt Hon Rishi Sunak MP said:
“Since the start of the coronavirus outbreak, I’ve made it clear that hard-working employers and employees should not have to suffer hardship unnecessarily. Our Coronavirus Job Retention Scheme supports workers and businesses up and down the UK – and today, we’re strengthening it because we will do whatever it takes to support jobs.”
With new guidance being issued regularly by Government, it can be challenging to keep on track with how the Coronavirus Job Retention Scheme will be implemented, who will benefit and how to access it.
We’ve put together this handy guide for employers and employees
| Employers Questions | Answers | Employees Questions |
| What is the Coronavirus Job Retention Scheme?
| The Coronavirus Job Retention Scheme is a temporary scheme open to all UK employers & employees for at least four months (this may be extended as necessary) starting from 1st March 2020. It is designed to support employers whose operations have been severely affected by coronavirus (COVID-19) and employees who would be at risk of losing their jobs. | What is the Coronavirus Job Retention Scheme?
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| What is a furloughed worker? | A furloughed worker is someone who has been granted a leave of absence temporarily, due to the operational capabilities of the business and economic environment. | What is a furloughed worker? |
| How do I tell employees they are to become a Furloughed Worker?
*Croner, a member of the IoSCM Expert Network, has provided us with a template for you to utilize. This is available in the ‘Business Resources’ area of the IoSCM COVID-19 Toolkit; | Employers must explain to employees that they are going to be temporarily designated as a Furloughed Worker, verbally, and a letter must be issued, and saved on file by the employer.
| How should I be told that I’ve been furloughed? |
| How much will the furloughed worker be paid? | *Please refer to the information at the top of this article. | How will it affect my pay? |
| It was necessary to make some redundancies before the scheme was announced, what happens to those former employees? | New guidance on the Coronavirus Job Retention Scheme published by the Government also confirmed that those made redundant after 19th March could be re-employed and placed on furlough. | I was made redundant before the announcement of the scheme, what can I do? |
| Who will pay the furloughed worker? | The employer submits a claim via the scheme and pays you via their usual payroll process. | Who will pay me? |
| How do we access the funding? | The Claim Portal is now available, via your PAYE account | |
| How long will the scheme be available? | The Coronavirus Job Retention Scheme is a temporary scheme open to all UK employers for at least four months (this will be extended if necessary) starting from 1st March 2020. It is designed to support employers whose operations have been severely affected by coronavirus (COVID-19) and employees whose job roles are not currently sustainable. | How long will the scheme be available? |
| Can my employee do volunteer work for the NHS? | Those on furlough will also be permitted to volunteer without risking their pay – and will be able to join the 500,000 members of the public who have signed up to help the NHS during the coronavirus outbreak. | Can I volunteer for the NHS? |
| Are National Insurance contributions and pension contributions included in the furloughed workers scheme?
| *Please refer to the latest information added at the top of this article.
| Will my National Insurance contributions and pension contributions be paid while I am on furlough? |
| Who will administer the scheme? | HMRC will administer the scheme. | Who will administer the scheme? |
| When my employees are on furlough, can I bring them in for a couple of days if I find work for them? | Once employees are on furlough, they will not be able to work for you during that period. | My employer has asked me to do some work while on furlough, can I do this? |
| The National Minimum Wage and National Living Wage is due to increase on 1st April 2020 is this going ahead?
| Yes, Government has decided to move forward with this planned increase.
| I am on National Minimum Wage, will the planned government increase be going ahead? |
| I have part-time workers, can they be furloughed? | Furloughed employees must have been on PAYE payroll on 19th March 2020, under any kind of contract, part-time included | I work part-time, can I be put onto the furlough scheme? |
| We have employees on zero-hours contracts, can we claim for them? | Furloughed employees must have been on PAYE payroll on 19th March 2020, and can be on any type of contract, a zero-hours contract included | I am on a zero-hours contract, can I be put onto the furloughed workers scheme? |
| We hired employees after 29th March, can they be furloughed? | Employees hired after 19th March 2020 cannot be furloughed or claimed for in accordance with this scheme. | I was hired after 19th March, can I be furloughed? |
| I have an employee on SSP; they are due to return to work, can I put them on the furlough scheme? | Employees on sick leave or self-isolating should get Statutory Sick Pay but can be furloughed after this. Employees who are shielding in line with public health guidance can be placed on furlough. | I’ve been self-isolating, therefore claiming SSP. I’m now fit for work but have been furloughed. |
| I have employees on Maternity/Paternity leave, can I put them on the furlough scheme? | Those about to go on maternity leave will go on leave as normal. However, if their earnings have reduced due to a period on furlough prior to the start of leave, and specifically during the period used to calculate their entitlement to Statutory Maternity Pay, their/your entitlement may be affected. | I am on maternity/paternity leave, can my employer put me on the furlough scheme? |
| Is there a minimum furlough period? | Yes, an employee must be furloughed for a minimum of 3 weeks. | Is there a minimum furlough period? |
| Can I make any necessary redundancies while claiming from the scheme? | When the Government ends the scheme, depending on the circumstances of the business, a decision will need to be made about whether employees can return to their duties. If not, it may be necessary to consider termination of employment (redundancy). | Can I be made redundant while on the scheme? |
| Can my employee work a second job while on furlough? | An employee can work for another employer as long as it does not breach the existing agreements within the employee’s contract. The job should be outside usual working hours, so for example, if the current job is Mon- Fri 9-5, an evening and weekend job delivering food for a supermarket would be acceptable. | Can I work a second job while on furlough? |
| When does the Scheme start? | Employees will receive their 80% pay from their employer and be paid on the usual company pay day. Employers can backdate their claims to 1st March, the portal will be available for claims on 20th April with the first payments expected to be made by the end of April. | When does the Scheme start? |
| How long do I place my employee on furlough? | This depends on when the company is able to reinstate the employee. Furlough must be taken in minimum blocks of 3 weeks, and government originally stated that the scheme would be available for 3 months. | How long will I be on furlough? |
| Can I furlough someone more than once? | The guideance would suggest that yes, furlough can be withdrawn then re-instated as the workload makes this possible. | Can I be furloughed more than once? |
| Does annual leave accrue during furlough? | Yes, annual leave continues to accrue during furlough. | Does my annual leave accrue during furlough? |
| 1 | (Letter Template) link to Toolkit *Croner, a member of the IoSCM Expert Network, has provided us with this template
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This is our understanding of the policy and how furlough will work, based on information published up to and including 17th April. It should not be relied on as a legal document but is intended to indicate how the scheme will work.
For further reliable information relating to COVID-19 for both businesses and individuals visit the IoSCM Toolkit. Designed as a free resource to support individuals and businesses with accessing reliable, accurate information to help them in a personal and professional capacity.
