What has changed with the available support for businesses through the Coronavirus lockdown?
The Job Support Scheme, has temporarily been postponed due to the second UK lockdown which started on the 5th November. While this support is not available at the moment, the Government has extended its’ Furlough scheme until March 2021; this covers both the Full and Flexible elements of furlough.
What does this mean for employers?
All employers with a UK bank account and UK PAYE scheme can claim the grant, whether the business is able to stay open or has had to close during this time. Employers do not need to have used the furlough scheme previously to use the extended scheme. They must, however meet the eligibility criteria, which can be found here.
For employees on full furlough, the employer does not need to make a wage contribution. Previous flexible furlough rules mean that the employer pays the employee for the hours worked. The employer could then claim 80% of wage costs for unworked hours to a maximum which is proportionately reduced in accordance with the number of unworked hours. Employers can choose to top up pay to the amount the employee would normally receive.
The employer must also pay the employer National Insurance contributions to HMRC as usual, including any scheme grant.
Which employees are eligible for furlough?
Employees are eligible for the furlough scheme even if they are unable to work because they:
1) are shielding in line with public health guidance (or need to stay at home with someone who is shielding). The Department of Health and Social Care (DHSC) has published revised guidance for the clinically extremely vulnerable on how they should keep safe.
2) have caring responsibilities resulting from Coronavirus, including employees that need to look after children.
Employees must have been on an employer’s PAYE payroll by 23:59 on 30 October 2020. This means a Real Time Information (RTI) submission notifying payment for that employee to HMRC must have been made between 20 March 2020 and 30 October 2020.
How do I furlough an employee?
In all cases, you should discuss the full situation with the employee(s) and agree with them that you are designating them as a furlough worker. This can be either the full or flexible scheme. The agreement should cover both changes to working hours and a reduction in pay (if you are not choosing to top up the pay to the full amount the employee would normally receive). It should also instruct employees to cease all work during furloughed hours.
There is no minimum furlough period. When claiming the grant for furloughed hours, employers will need to report and claim for a minimum period of 7 consecutive calendar days.
Claims can be made from 08:00 on Wednesday 11 November 2020.
Further guidance is due to be published on Tuesday 10 November 2020. We will update when the new guidance is received. For more information on the scheme, please get in touch with our specialist HR consultants who can support you through this time.