Changes in the Furlough Scheme

I hope you are still well.

This week I've focused on the changes to the Furlough Scheme, which I must say is starting to get more complicated.

If you haven't already, I highly recommend making use of an HR consultant if you have staff moving in and out of furlough to keep the business going. I can recommend someone if you need it.

On the whole, the business world is starting to get back to 'normal’. However, there is a long way to go before the economy is back on its feet and many are still finding conducting business at this time very difficult.

Our expert consultants have already helped businesses develop new ways of working and getting cash flow going again. If you want some help, please let me know and we will book you a free session - we want to support all businesses right now.

Please call me on 0330 0904 565 or use the contact us form on our website.

As always, please stay safe.

Doug D'Aubrey.

Furlough Scheme

There are new rules for the furlough scheme (WOW!):

• From 1st July you will only be able to furlough people who have been furloughed previously for a period of at least 3 consecutive weeks between 1st March and 30th June, during this time they were unable to do any work for the business
• Furlough can now be used to bring employees back to work for any amount of time, and any work pattern. This will need to have been agreed with the employee and confirmed in writing
• Furlough grant can be claimed for the hours the employee does not work, compared to the hours they would normally work
• You can choose to top up your employees’ wages above the minimum furlough pay amount, but you do not have to. Employees must not work or provide any services for the business during hours which they are recorded as being on furlough, even if they receive a top-up wage
• From July 1, the number of workers an employer can put on furlough will be capped at the maximum number it has previously claimed for in any one claim period (see below for claim period definition)
• For example, let's say an employer had previously submitted three claims between March 1 2020 and June 30 2020, and each claim was for 30, 20 and then 50 employees.
• The maximum number of employees that company can claim furlough for at any one time is capped at 50 from next month.
• Currently, workers have to be furloughed for three weeks at a time before employers can claim the cash back from the Government, but the in the latest round of guidance, employees can be furloughed for any amount of time from July 1.
• However, employers can only claim the money in minimum blocks of seven calendar days.
• Before they can be rolled onto the flexible furlough scheme, a worker will need to complete their current three-week stint on the CJRS first.
• For example, if an employee is begins a new three-week period on June 22, they won't be able to work part-time until it’s over which will be on July 12. This would only apply to an employee who had been furloughed for a three week period before 10th June and had started a new three week period. The last day for starting an employee for furlough was 10th June
• Only those who have been on parental leave and in receipt of statutory pay will be able to be newly rolled onto the furlough scheme. This includes those on maternity, paternity, shared-parental, adoption, parental bereavement and unpaid parental leave. Their furlough pay will be calculated based on 80% of their normal salary before tax, not what they have been earning during their leave.

If you've managed to make sense of the above, brilliant!

If you need help, I highly recommend making use of an HR consultant. I can recommend someone if you need it. Please call me on 0330 0904 565 or use the contact us form on our website.

Claim periodsYour claim period is made up of the days you are claiming a grant for. The start date of your first claim period is the date your first employee was furloughed. You can backdate your claim to 1 March 2020 where employees have already been furloughed from that date.

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. This is the case even where an employee furloughed in June continues to be furloughed full time in July. Separate claims will need to be submitted to cover the days in June and the days in July that you want to claim for, even if employees are furloughed continuously. This may mean that your claim periods will differ from the pay periods you use.

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. You can only claim for a period of fewer than 7 days if the period you are claiming for includes either the first or last day of the calendar month, and you have already claimed for the period ending immediately before it.

Record keeping requirements

You must keep a copy of all records for 6 years, including:

• the amount claimed and claim period for each employee
• the claim reference number for your records
• your calculations in case HMRC need more information about your claim
• usual hours worked, including any calculations that were required, for employees you flexibly furloughed
• actual hours worked for employees you flexibly furloughed

We will continue to update you as more information becomes available.

If you need any help, please contact me on 0330 0904 565 or using the contact us form on our website.

Please continue to stay safe, follow the advice from the government and continue to support one another.

Best regards,

The ETC team