COVID19: Job Retention Scheme (Furlough Leave)

  • 26 March 2020 update – Further Government guidance on the Job Retention Scheme (JRS)
  • Businesses, Charities, Recruitment Agencies and Public Authorities eligible to use the scheme
  • Employees eligible for JRS are:
    • Full Time,
    • Part-Time,
    • Employees on Agency Contracts and
    • Employees on Flexible or Zero Hours contracts whose contract of employment continues.
  • The employee must have been on the PAYE payroll scheme on or before 28 February 2020.
  • JRS also covers employees who were made redundant since 28 February 2020, if they are then rehired by their employer.
  • To be eligible for Furlough the employee must not carry out any work for the employer, but they can volunteer as long as it does not provide services to or generate revenue for, or on behalf of the employer.
  • Employers will receive a grant from HMRC to cover the lower of 80% of an employee’s regular wage or £2,500 per month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that subsidised wage.  However, fees, commission and bonuses should not be included.
  • Employees on sick leave or self-isolating should receive Statutory Sick Pay but can be furloughed after this.
  • Employees who are shielding in line with public health guidance can be placed on furlough.
  • Payments under the JRS should be based on:
    • the same month’s earning from the previous year
    • average monthly earnings from the 2019-20 tax year or such shorter period as may apply to new employments
  • The amount payable to furloughed workers does not need to meet NLW/NMW rates.
  • Employers can only submit one claim at least every 3 weeks, which is the minimum length an employee can be furloughed for and claims can be backdated until the 1 March if applicable.

See the Government guidance here.

Aspire Comment

Now is the time to ensure you follow appropriate and reasonable consultation with staff and consider if you wish to withdraw any redundancies made since 28 February 2020.   You should also be planning for what happens when the scheme comes to an end as redundancy may be on the horizon.

If you require any further advice or guidance about how to manage the furlough process or any other employment guidance, such as lay off or short time working or redundancy, do get in touch with one of our team on 0121 445 6178.

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