The employment challenges associated with dealing with Coronavirus and the Coronavirus Job Retention Scheme continue to change and evolve.
The most significant recent change relates to the ability to furlough people on a part-time basis from 1st July 2020 and there’s more information on this below. We’ve also included the other known changes to the scheme as a refresher.
The questions answered in this post are:
- I’ve read that, from 1st July 2020 I have an option to use furloughed employees on a part-time basis. Is that correct?
- Do I have to put anything in writing to employees if they are furloughed on a part-time basis?
- When does the Coronavirus Job Retention Scheme end?
- What can I claim for under the Coronavirus Job Retention Scheme?
The information that follows has been compiled with input from government websites, Acas and HMRC (the only official resources that we’re happy to use as these are the institutions who will be responsible for enforcing the rules as we move forward), but the reality is no-one really knows for certain how actions that businesses need to take now will be interpreted later.
As with all of the guidance with coronavirus, we need to remind you that these are unprecedented times and it is unclear as to how employment law will be applied in these exceptional circumstances.
We strongly advise you to get in-touch with us on 0203 319 1649 to seek tailored guidance before you take any actions.
1. I’ve read that, from 1st July 2020 I have an option to use furloughed employees on a part-time basis. Is that correct?
Yes, the government has confirmed that from 1st July 2020 employers are able to use furloughed employees for any hours or shift patterns whilst continuing to claim for any unworked hours under the CJRS.
There is full flexibility when it comes to part-time working and you really can have employees back for as many or as few hours per week as you need. You pay employees as normal for the hours/days that they work for you and then you reclaim via the CJRS for the hours for which they remained furloughed.
The way that this work is as follows:
- Start by calculating the normal weekly hours that an individual works.
- For most cases this will be straight-forward as this would the normal weekly contractual hours
- If people are working on a more ad-hoc basis, however, then this may be slightly more challenging.
- For those who are already furloughed, you will have already calculated their normal weekly hours as that is what you will have been claiming for to date.
- From there, you can calculate how many hours the individual has worked and how many they have been furloughed for, and this will form the basis of your furlough claim.
- In July, you can then claim 80% of the pay for the furloughed days (with the current cap still being applied) along with the same proportion of the employers NI and pension contributions.
This may sound complicated but there is a calculator on the government website that supports you through the process. You can find it here www.tax.service.gov.uk/job-retention-scheme-calculator/claim-period-start.
Note: the amount that you can reclaim under the furlough scheme starts to decrease from August 2020.
The ability to furlough on a part-time basis is great for everyone. It may enable you to start operating your business again whilst keeping costs controlled. It also presents you with an opportunity to continue to support employees who have on-going caring responsibilities.
2. Do I have to put anything in writing to employees if they are furloughed on a part-time basis?
Yes. You will have written to individuals when you placed them on furlough and that furlough agreement is currently running in-line with their standard contract of employment.
If you’re going to now have the employee working on a part-time basis then you are changing the terms of the furlough agreement and you need to confirm this in writing.
3. When does the Coronavirus Job Retention Scheme end?
The scheme has been extended until the 31st October 2020 but there are some changes being made in the coming months.
A key point of note is that the last date on which you can furlough someone for the first time was 10th June 2020.
4. What can I claim for under the Coronavirus Job Retention Scheme?
There are changes to the level of support the government is offering after 1st August 2020. The scheme for the coming months is as follows:
- 1st June – 31st July
- Employers can reclaim 80% of salary up to a maximum of £2,500. In addition, the employer can reclaim statutory pension contributions and employer National Insurance payments.
- No change from April – May.
- 1st August – 31st August
- Employers can reclaim 80% of salary up to a maximum of £2,500.
- Employers will no longer be able to claim for National Insurance or pension contributions.
- 1st September – 30th September
- Employers can reclaim 70% of salary up to a maximum of £2,190 but must continue to pay the employee 80% of their salary up to a maximum of £2,500.
- The level of support starts to decrease and the employer becomes responsible for paying part of the employee’s costs.
- 1st October – 31st October
- Employers can reclaim 60% of salary up to a maximum of £1,875 but must continue to pay the employee 80% of their salary up to a maximum of £2,500.
- The level of support decreases further and the employer becomes responsible for paying a larger part of the employee’s costs.
Employment laws still apply
When making changes to working hours or other terms and conditions, assuming your employment contract does not already allow for that, normal employment law applies – refer to our post on employment law: Job Retention Scheme – Employment Laws Still Apply.
Also, the employer must be careful not to discriminate in deciding who to offer furlough too – refer to our post on furlough discrimination: Furlough Decisions – Beware of Unintended Discrimination.