Coronavirus Job Retention Scheme

Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis.

Is my business eligible?

Yes – this is available for businesses and charities of all sizes and sectors in the UK. 

You must have:

  • created and started a PAYE payroll scheme on or before 19 March 2020
  • enrolled for PAYE online
  • a UK Bank account
  • Using the Flexible Furlough Scheme

    The Flexible Furlough Scheme: Previously furloughed employees will be able to work part of the week and be furloughed for part of the week. They will be paid their full pay for any hours worked and receive 80% of their pay for the remaining furloughed hours. 

    Considerations before you start:

    • Involve your Employees (or Union Representatives) and gain agreement
    • Choose fairly and avoid discrimination
    • Write to the affected employees informing them that they are being furloughed, outlining the flexible arrangement (keep these records for 5 years)
    • Plan your Payroll and consider what needs to be included when calculating wages
    • Keep records for each employee on what hours have been worked and what hours the employee is on furlough (keep these records for 6 years)

    The amount you claim for in any single claim period starting from 1 July cannot exceed the maximum number of employees you claimed for under any claim ending by 30 June. Exceptions are made for employees returning from Family Leave and those returning from military service. 

    Claim periods starting on or after 1 July must start and end within the same calendar month and must last at least 7 days unless you’re claiming for the first few days or the last few days in a month.  The 7 days refers to claim periods and not periods of flexible furlough.

    In September, HMRC’s contribution will reduce to 70% (up to £2,190 per month) and employer’s will have to pay at least 10%. 

    In October, HMRC’s contribution will reduce to 60% (up to £1,875) and employer’s will have to pay at least 20%. 

    The current position is that the Job Retention Scheme will end at the end of October.


    We can provide template letters for the following:

    • Letter to place employee on flexible furlough
    • Letter to deny request for furlough 
    • Letter to end a period of furlough 
    • Letter to extend a period of furlough 
    • Letter to extend probationary period due to coronavirus 
    • Letter to suspend disciplinary procedures due to furlough 
    • Letter to respond to annual leave request during furlough 
    • Letter to require employee to take annual leave during furlough 
    • Letter rescheduling a disciplinary hearing due to Covid-19



    Job Support Scheme

    This will replace the Job Retention Scheme (Furlough Scheme) on November 1st 2020 for 6 months initially to April 2021.  

    What is it?

    It is a scheme that supports short time working hours where employers can agree with staff for them to work fewer hours per week (working a minimum of 33% of their normal hours). Employees will be paid by their employers at their usual rate for the hours worked and for every hour not worked by the employee, both the Government and employer will pay a third each of the usual hourly wage for that employee. The Government contribution will be capped at £697.92 a month.


    Who is eligible?

    Employers

    • All small and medium size employers with a UK bank account and UK PAYE schemes can claim the grant.
    • Neither the employer nor the employee needs to have previously used the Coronavirus Job Retention Scheme.
    • Larger businesses (expected to be those with over 250 employees) will have to meet a financial assessment test but may still be eligible. 

    Employees

    • Employees must be on an employer’s PAYE payroll on or before 23 September 2020. This means a Real Time Information (RTI) submission notifying payment to that employee to HMRC must have been made on or before 23 September 2020.
    • In order to support viable jobs, for the first three months of the scheme the employee must work at least 33% of their usual hours. 
    • Employees will be able to cycle on and off the scheme and do not have to be working the same pattern each month, but each short-time working arrangement must cover a minimum period of seven days.

    Other important information:

    • Grant payments will be made in arrears, reimbursing the employer for the Government’s contribution. 
    • Employers using the Job Support Scheme will also be able to claim the Job Retention Bonus if they meet the eligibility criteria. 
    • The grant will not cover Class 1 employer NICs or pension contributions, although these contributions will remain payable by the employer.
    • “Usual wages” calculations will follow a similar methodology as for the Coronavirus Job Retention Scheme. Full details will be set out in guidance shortly. 
    • We are waiting to hear if employers can top up their employees’ wages above the two-thirds contribution to hours not worked at their own expense but it is unlikely. 
    • Employers will be able to make a claim online through Gov.uk from December 2020. They will be paid on a monthly basis.
    • HMRC will check claims. Payments may be withheld or need to be paid back if a claim is found to be fraudulent or based on incorrect information.
    • As with the Furlough Scheme, employers must agree the new short-time working arrangements with their staff, make any changes to the employment contract by agreement, and notify the employee in writing. This agreement must be made available to HMRC on request.



    Statutory Sick Pay Refund 

    The Coronavirus SSP Rebate Scheme is open for applications. The scheme covers staff SSP payments for up to two weeks of sickness absence when the absence is related to the coronavirus outbreak. Any additional, contractual sick pay is not included.

    The eligibility criteria for the scheme will be as follows:

    • this refund will cover up to 2 weeks’ SSP per eligible employee who has been off work because of COVID-19 on or after 13th March 2020
    • employers with fewer than 250 employees will be eligible - the size of an employer will be determined by the number of people they employed as of 28 February 2020
    • employers will be able to reclaim expenditure for any employee who has claimed SSP (according to the new eligibility criteria) as a result of COVID-19
    • employers should maintain records of staff absences and payments of SSP, but employees will not need to provide a GP fit note. If evidence is required by an employer, those with symptoms of coronavirus can get an isolation note from NHS 111 online and those who live with someone that has symptoms can get a note from the NHS website
    • eligible period for the scheme will commence the day after the regulations on the extension of SSP to those staying at home comes into force
    • the government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible
    • the current rate of SSP is £95.85 per week (£94.25 prior to 6th April 2020)

    The Scheme covers any members of staff who were on a PAYE payroll scheme created and started before 28 February 2020. This includes:

    • full-time employees
    • part-time employees
    • employees on agency contracts
    • employees on flexible or zero-hour contracts

    Furloughed staff are not included and should not be receiving SSP. Employers can furlough their employees who have been advised to shield in line with public health guidance and are unable to work from home. Where an employee has been notified to shield and has not been furloughed, the rebate will compensate up to 2 weeks of SSP from 16 April 2020

    Is your business eligible?

    Businesses are eligible for the scheme if:

    • they are UK based
    • the business is a small or medium-sized and employs fewer than 250 employees as of 28 February 2020

    Answers to frequently asked questions

    • Employers are free to switch employees from sick pay to furlough
    • Employers of newly TUPE’d employees can put them on furlough
    • Employers can furlough ‘shielding’ employees
    • Employers can claim through the scheme for enhanced maternity pay
    • Employers can furlough employees unable to work because of care responsibilities arising as a result of coronavirus
    • Holidays can be taken during a period of furlough and must be paid at full pay
    • Employers can require employees to take holiday during a period of furlough as long as they give the required notice
    • Where it has not been reasonably practicable for the worker to take some or all of the 4 weeks’ holiday due to the effects of coronavirus, the untaken holiday may be carried forward into the following 2 leave years. When calculating how much holiday a worker can carry forwards, employers must give workers the opportunity to take any leave that they cannot carry forward before the end of the leave year.


    Last updated: 25 Sep 2020 4:12 PM