At 9pm on 12 June, the Government updated its guidance on the Coronavirus Job Retention Scheme to provide more detail about how the revised Scheme, which begins on 1 July, will operate. The revised Scheme provides for flexible furloughing from 1 July.
The latest Government guidance can be found here. https://www.gov.uk/government/collections/coronavirus-job-retention-scheme
Some key points from the latest updated guidance are as follows:
Eligibility on who can be furloughed after 1st July 2020
- From 1 July, only employees that you have successfully claimed for under the Scheme will be eligible to be furloughed. This means that they must have previously been furloughed for at least three consecutive weeks taking place at any time between 1 March and 30 June 2020. The last day an employee could have started furlough for the first time was 10 June.
- Ensure that agreement (in writing) has been made with employee / collective agreement with Union to furlough / flexi furlough. Flexible furlough agreements can last any amount of time. Employees can enter into a flexible furlough agreement more than once.
Holiday / Annual leave entitlement
- Furloughed employees continue to accrue leave as per their employment contract. The employer and employee can agree to vary holiday entitlement as part of the furlough agreement, however almost all workers are entitled to 5.6 weeks of statutory paid annual leave each year which they cannot go below.
- If an employee usually works bank holidays then the employer can agree that this is included in the grant payment. If the employee usually takes the bank holiday as leave then the employer would either have to top up their usual holiday pay, or give the employee a day of holiday in lieu.
Claim periods / calculations
- There is no maximum length for claim periods that end on or before 30 June. However, claims for any periods starting before 1 July must end on or before 30 June.
- From 1st July, claim periods cannot cover more than one calendar month. You must make separate claims if a pay period spans across 2 months i.e if weekly period is for e.g. 27th June-3rd July
- Claims for periods ending on or before 30 June 2020 must be made by 31 July 2020.
- 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 number of employees you can claim for in any single claim period starting from 1 July cannot exceed the maximum number of employees you claimed for in any claim ending 30 June. For example, if you had previously submitted three claims between 1 March and 30 June, in which the total number of employees furloughed in each respective claim was 30, 20 and 50 employees, then the maximum number of employees you could furlough in any single claim starting on or after 1 July would be 50. There are some exceptions relating to employees returning from family leave where this cap may not apply.
- For claim periods starting after 1 July, employers can bring furloughed employees back to work for any amount of time and on any work pattern, while still being able to claim under the revised Scheme for the hours the flexibly furloughed employee does not work referable to the hours they would normally have worked in that period.
- Examples of how to calculate your employee’s wages / national insurance contributions and pension contributions
- When claiming for employees who are flexibly furloughed, you should not claim until you are sure of the exact number of hours they will have worked during the claim period. You will therefore need to work out, and record, your employees’ normal working hours and their furloughed hours before you calculate how much you can claim.
- Payments will be made 6 working days after you make your claim.
Flexible furloughing enables you to bring the workforce back in a staggered way while continuing to receive financial support under the Scheme. However, you will need to plan carefully. For example, you will need to:
- think about the hours and shift patterns that you want employees to work on their return.
- communicate and consult with previously furloughed employees;
- agree any contractual changes and confirm them in writing;
- consider the impact the financial tapering will have; and
- decide your claim period.