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:
How to access the scheme?
You will need to:
- designate affected employees as ‘furloughed workers,’ and notify your employees of this change - changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation. If you need help and advice in this area please let us know and our dedicated payroll and HR team can advise you
- submit information to HMRC about the employees that have been furloughed and their earnings through the HMRC online portal.
The Government will cover up to 80% of furloughed workers wage costs, up to a cap of £2,500 per month plus employer’s NI and pension contributions on that sum. This is so that the businesses can retain employees who would otherwise be made redundant due to Coronavirus related disruption.
Yet to Furlough some staff?
Please note that if you wish to furlough staff that have not yet been furloughed, you will need to do so by 10th June. From July, employers will only be able to furlough employees that they have previously furloughed for a full 3 week period prior to 30th June.
Upcoming changes to the scheme
From 1st July, ‘Flexible Furloughing’ is to be introduced. 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)
Where a previously furloughed employee starts a new furlough period before 1 July this furlough period must be for a minimum of 3 consecutive weeks. This is the case regardless of whether the 3 consecutive week minimum period ends before or after 1 July.
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 August, HMRC will still pay 80% but will no longer pay the employer’s NI or pension contributions.
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 employees on furlough
- 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 place shielding employees on furlough
- Letter to place employee on further period of 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
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: 24 Jun 2020 11:03 AM