On Saturday the 31st of October 2020, the government announced that the furlough scheme was going to be extended until the 2nd of December 2020. Employers were in the difficult position of having to consider redundancies to coincide with the end of the furlough scheme. The scheme was due to be replaced by the Job Support Scheme (’JSS’) which was somewhat less generous. Effectively, this change in direction puts us back in the same position that we were in during August; the government paying 80% of an employee’s pay (subject to the cap of £2,500) with employers being liable for national insurance and other contributions which would normally be payable. The scheme will allow employers to fully or flexibly furlough their employees.
Frequently asked questions
Can I put an employee on the scheme who wasn’t eligible for furlough before?
Yes – employers will be able to furlough employees full time or part time, but to be eligible for the grant an employee must have been on an RTI submission made to HMRC before 23.59 on 30 October 2020. There is no requirement for them to have been furloughed previously.
Can we pay 100%?
If you choose to then yes, but we advise this is clearly documented to employees and they know they are on furlough leave for any hours not worked. The government scheme can only be claimed against when you are paying 80% of unworked hours as a minimum, it cannot be claimed to off-set any private furlough schemes which may be ongoing between employer and employee.
Can I use furlough to cover notice pay?
This is not yet clear, but there is nothing to suggest you can’t use it for notice period, and this was permitted under the furlough scheme as it was before. The exception to this is where notice pay is paid as a lump sum – known as pay in lieu of notice. Furlough payments cannot cover this unless the employee is actually working their notice period.
Can employees take holiday whilst on furlough?
There is nothing to suggest that they can’t – it would appear that the terms of the old scheme still continue to apply.
Is there a minimum period for furloughing an employee?
When claiming the CJRS grant for furloughed hours, employers will need to report and claim for a minimum period of 7 consecutive calendar days.
When can I begin claiming?
It is anticipated that claims can be made from December 2020 but we await further guidance.
What will happen to the job retention bonus?
This is not yet clear, but it is likely that the dates may need to be changed, or the scheme re-evaluated. This is because it is unlikely that the government will allow qualifying wages to be made from the public purse, and for this to allow employers to claim further public money. However, this is an educated guess rather than a fact.
Do I have to put this into writing?
Yes, as per previous guidance this will need agreeing in writing – unless you have a lay-off clause which permits you to lay staff off without pay. This should be kept on file should HMRC choose to audit your business.