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Furlough Working - The Small Print
March 27, 2020
The Government release further details on Furlough Working
After what has felt like an eternity for business owners the government has now published further details of the Coronavirus Job Retention Scheme (CJRS) or, what you’ve more likely been referring to as the Furlough Scheme.
The new guidelines which can be found in full here, do provide more detailed guidance that has not previously been available and the key points are:
- The scheme will be open to all UK employers were on the PAYE scheme on 28th February 2020. Anybody who was on the payroll on 28th February 2020 and has since been made redundant can be rehired and put on the scheme.
- Any organisation with employees can apply for the furlough payments, including charities, recruitment agencies and public authorities; however, the government does not expect public sector employers to use it as long as central government continues funding wage costs in the normal way.
- With agency employees, the scheme is only available for agency employees who are not working.
- Employers can reclaim up to 80% of wage costs up to a cap of £2,500 per month, plus (not including) the associated employer NICs and minimum auto enrolment pension contributions on that wage. Remember that as an employer you can choose to top up to 100% if you have the funds available.
- Fees, commissions and bonuses are not included.
- If employees are furloughed and the 80% payment would take them below the minimum wage based on their normal working hours, they still only receive 80% as they are not working. However, they are entitled to be paid NMW for any time spent training which businesses will be expected to pay.
- For employees whose pay varies, the employer can claim for the higher of either the same month's earning from the previous year or average monthly earnings in the 2019-20 tax year.
- Furlough leave must be taken in minimum blocks of three weeks and employers can only claim once every three weeks. Claims will be backdated to 1 March 2020.
- Employees on furlough leave must not be working at all. However, they are able to undertake training and do volunteer work, provided they do not provide services to or conduct any revenue generating activity.
- Employees on sick pay cannot be furloughed, but can be furloughed afterwards.
There are still lots of unanswered questions so please get in touch
for any specific advice and support when furloughing employees.
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As our working and home lives continue to become ever more intertwined the blurred boundaries can lead to increased stress for employees, in extreme cases, burnout and a general decrease in employee well-being.
As we approach the end of the year, it's the perfect opportunity to ensure that your employees are making full use of their annual leave entitlements, especially if your company's holiday policy does not allow for unused leave to roll over into the following year.
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