Lorna Baker, our HR Consultant helps to answer all the questions about Furlough, we have been inundated with lots of questions, all relating to the recent Furlough situation, so Lorna thought it would be a good idea to combine all the questions and put detailed Q and A together.
If you would like to do a LIVE call with Lorna, please let me know and I can set up a Zoom / Micro Soft Teams.
Furlough – let’s make it clear
You may have seen that the online Coronavirus Job Retention Scheme portal is now open, so you can claim back 80% of your employees wages for those employees on furlough. But before running for the internet to claim…. stop and check your ducks are in a row first to save time in the long run.
The Coronavirus Job Retention Scheme is a temporary scheme in place for 4 months starting from 1 March 2020. This was previously 3 months, but has been extended. We can’t say if it will be extended again at this point. We await government advice.
To claim, you need to check eligibility:
- Have you agreed with your employee/s that they will be furloughed, and what this means?
- Have you agreed with your employee/s in writing that they will be furloughed?
- Have they agreed to be furloughed for a minimum of 3 weeks?
- Your employee must not, and we cannot stress enough…MUST NOT undertake any form of work for your company. None.
Bear in mind that when the HMRC audits this, which they will, you need to be absolutely water tight.
- You can claim 80% of wages up to a maximum of £2,500 per month per furloughed employee;
- A separate claim is needed for each PAYE scheme.
- You can only claim for furloughed employees that were on your PAYE payroll on or before 19 March 2020.
- An RTI submission notifying payment in respect of that employee to HMRC must have been made on or before 19 March 2020.
- You must have a UK bank account
To clear a few queries up so you don’t have your claim rejected………
Q. Do I need to give notice of furlough?
A Technically no, as long as you have sought agreement with the employee. It’s good practice to give 48 hours’ notice if practical.
Q Can I furlough an employee for a week and then bring them back?
A No – furlough is for a minimum of 3 weeks and can be continued in week blocks.
You can ask an employee return to work after the initial 3 weeks, and be re-furloughed should there be specific business reasons. To re-furlough them, it will again need to be for a minimum of 3 weeks.
Q Can my employee be furloughed for part of the working week and undertake work for the remainder of the week? Even if it’s one day?
A Absolutely not. Employees are not to undertake any work that is of service to the organisation. None.
Q I’ve got a trustworthy team so we’ve just decided between ourselves who’s going on furlough.
A Alarm bells are immediately ringing. It’s great you have a good team. But you need clear processes and a clear audit trail. People are unpredictable, and you are leaving yourself open for constructive dismissal claims. You must have a written furlough agreement between individual employees and the organisations, to be eligible for the scheme.
Q My employee/s wont agree to furlough.
A If you cannot reach an agreement with an employee, you may want to change the written terms in their contract. If this affects more than 20 people, you will need to go through a consultation process.
Remind them of the alternatives which may be short time working or lay off (if your contracts allow). This wouldn’t be financially favourable. Ultimately, the aim of this is to avoid redundancy situations.
Q Can my employee work for another company whilst on furlough from our organisation?
A Yes. But make sure this doesn’t breach any contractual terms. You will also need to consider logistical factors such as notice periods of the 2nd job, when you are wanting to end their furlough leave.
Q Can my employee/ s undertake volunteer work?
A Yes, they can take part in volunteer work in line with public health guidance. As long as it’s not associated to your organisation in any way, nor generates revenue for your organisation.
Q Can my employee undertake any training whilst on furlough?
Yes, as long as it doesn’t provide any service to or generate revenue to your organisation.
Q Can I tell employees to take holiday during a period of furlough? I’ll have all my staff on holiday at the latter end of the year otherwise!
Yes – under the Working Time Regulations 1998, you can tell employees to use annual leave during a period of furlough. This has to be paid at 100% of their contracted salary, i.e not the furlough rate. You will have to provide the correct notice period, this being double the amount of notice, as the amount of time you wish them to take. So if you need an employee to take 5 days holiday, you’ll need to give them 10 days notice of this.
Q I am getting requests from employees asking for furlough leave. How do I deal with this?
A This isn’t annual leave. There is no statutory entitlement to furlough. You as the employer decide what roles are required to be furloughed and have a business case for doing so (don’t forget to have written rationale in case of HMRC audits down the line).
Q How do I pay my employees their furloughed wage?
You must pay them on their usual pay date, at the rate that has been agreed (80% minimum for furloughed employees). You can then claim 80% back from the online portal accessible via the government gateway.
Check with us if you’re unsure whether you are furlough compliant.
Once you’re sure you are you are compliant, you can start to put together your claims.
The government has provided an online calculator to support your calculations for furlough which is available here: https://www.gov.uk/guidance/work-out-80-of-your-employees-wages-to-claim-through-the-coronavirus-job-retention-scheme
To access the Coronavirus Job Retention Scheme Portal, you will need to log into your Government Gateway Account here: https://www.gov.uk/log-in-register-hmrc-online-services
Where employers receive public funding for staff costs, and that funding is continuing, we expect employers to use that money to continue to pay staff in the usual fashion – and correspondingly not furlough them. This also applies to non-public sector employers who receive public funding for staff costs.
Organisations who are receiving public funding specifically to provide services necessary to respond to COVID-19 are not expected to furlough staff.
Please check with Lucy or myself if in doubt on 01527 571 611, we are here to keep you doing things right!
If you do have any concerns about furlough, the portal, or HR queries in general, don’t hesitate to get in touch for practical advice.