Important changes to Furlough (21-12-2020)
The furlough scheme has been extended until the end of April 2021 with the government continuing to contribute 80% towards wages.
Furloughed staff serving a notice period
If you are making a claim for furloughed staff who are serving their notice period, previously there were no restrictions on this, and staff could be made redundant even if they were currently on furlough.
Now, it seems that the government are going to be a bit stricter in this regard, suggesting that from December they may prohibit claims for those who are serving notice periods.
While this has yet to be confirmed, it would be consistent with previous government plans for the furlough scheme’s planned replacement, the Job Support Scheme before it was indefinitely postponed; claims were not to be permitted for those serving a notice period.
Do check on the government website for further clarification on this.
Staff who wish to return from maternity leave early now need to provide at least eight weeks’ notice of their intention to do this, and their employer cannot place them on furlough until these eight weeks are up. This provides less freedom for staff in this position, and employers will need to make sure that all employees seeking to return off maternity leave early are aware of this.
Depending on their situation, it may be more advisable for them to remain on the leave as planned.
The government have clarified that rules on taking annual leave while furloughed are to remain the same; those who do take it must be paid in full for this time.
If furloughed staff fall ill, it will be down to employers if they keep them furloughed or class them as on sick leave and therefore start paying them SSP if they qualify.
Future amendments to the guidance are expected and will hopefully clarify this further and employers should approach this situation with caution for now.
Another central point to consider is guidance on whether staff that transferred over to a business under TUPE can be furloughed. As before, it seems that this will depend on when the transfer took place, critical dates for which being specified in the guidance.
Going forward, it is essential that employers familiarise themselves with this guidance as much as possible and regularly check it for updates. It should be remembered that the furlough scheme has seen numerous amendments since it was originally implemented, a trend that does seem likely to continue over the next few months.
Coronavirus Job Retention Scheme (CJRS)
The CJRS is available for an employer to claim for employee’s wages if you have put them on furlough or flexible furlough because of Covid-19.
The CJRS has been extended until 30 April 2021. You can claim 80% of an employee’s usual salary for hours not worked up to a maximum of £2,500 per month.
You can claim for employees on any type of employment contract, including full-time, part-time, agency, flexible or zero-hour contracts. Foreign nationals are eligible to be furloughed. Grants under the scheme are not counted as ‘access to public funds’, and you can furlough employees on all categories of visa.
You employee is eligible for the grant and can be furloughed, if they are:
- unable to work because they are clinically extremely vulnerable, or at the highest risk of severe illness from coronavirus and following public health guidance
- unable to work because they have caring responsibilities resulting from coronavirus (COVID-19), including employees that need to look after children
If your employee is on sick leave or self-isolating as a result of coronavirus, they may be able to get Statutory Sick Pay (SSP). The Coronavirus Job Retention Scheme is not intended for short-term absences from work due to sickness.
Short term illness/self-isolation should not be a consideration in deciding whether to furlough an employee. If, however, employers want to furlough employees for business reasons and they are currently off sick, they are eligible to do so, as with other employees. In these cases, the employee should no longer receive sick pay and would be classified as a furloughed employee.
Employers can furlough employees who are clinically extremely vulnerable or at the highest risk of severe illness from coronavirus. It is up to employers to decide whether to furlough these employees. An employer does not need to be facing a wider reduction in demand or be closed to be eligible to claim for these employees.
Read more here.
Correcting CJRS Claims
Some employers made CJRS claims for the periods to 31 July and didn’t include an amount for employer’s NIC in those claims. For periods from 1 August onwards the employer’s NIC liability can’t be included in CJRS claims. All Employers should therefore review their likely class i NIC liability for the whole of 2020/21.
Job Retention Bonus
The Job Retention Bonus is a one-off payment to employers of £1,000 for every employee who they previously claimed for under the scheme, and who remains continuously employed through to 31 January 2021. Eligible employees must earn at least £520 a month on average between the 1 November 2020 and 31 January 2021. Employers will be able to claim the Job Retention Bonus after they have filed PAYE for January and payments will be made to employers from February 2021.
Statutory Sick Pay
The government is supporting SMEs and employers to cope with the extra costs of paying COVID-19 related Statutory Sick Pay (SSP) by refunding eligible SSP costs. This will enable staff to get Statutory Sick Pay (SSP) from the first day they self-isolate and cannot work, rather than waiting 3 days.
If you’re an employer who pays more than the current rate of SSP you can only claim the current rate amount.
The repayment will cover up to 2 weeks starting from the first day of sickness, if an employee is unable to work because they either:
- have coronavirus
- cannot work because they are self-isolating at home
- are shielding in line with public health guidance
Employees qualify for SSP if they meet the criteria and cannot work if any of the following apply:
- you or someone you live with has coronavirus symptoms or has tested positive for coronavirus
- you’ve been notified by the NHS or public health authorities that you’ve been in contact with someone with coronavirus
- someone in your ‘support bubble’ (or your ‘extended household’ if you live in Scotland or Wales) has coronavirus symptoms or has tested positive for coronavirus
- you’ve been advised by a doctor or healthcare professional to self-isolate before going into hospital for surgery
You could also get SSP if you’ve been advised to take extra precautions because you’re at very high risk of severe illness from coronavirus (known as ‘shielding’).
You cannot get SSP if you’re self-isolating after entering or returning to the UK and do not need to self-isolate for any other reason.
Expenses and benefits
The coronavirus pandemic and following imminent lockdown impacted everyone overnight. With many people having to work from home or becoming furloughed, there are wide ranging financial impacts, some of which you may be able to claim for.
- Are you working from home?
- Are you living away from home?
- Do you have a company car that you are not using due to working from home?
To help you keep your business operating, we’ve made it easy to access the correct and most up-to-date information. Below, you’ll find information on government support for businesses and individuals and practical advice to help you to manage your business through this unusual period.