Can I Tap Into the Flexible Furlough Scheme?
- AuthorNatasha Johnston
From July 1 many employers may be looking at introducing part time working as well as claiming from the Coronavirus Job Retention Scheme. HR Advisor, Natasha Johnston, shares some updates regarding flexible furlough.
Employers are only able to use this flexible scheme if:
- The employee was on furlough leave for a period of three weeks between March and June.
Employees who have been on statutory maternity and paternity leave can also be placed on the furlough scheme after the cut-off date of June 10 2020. This can only be done if the employer has previously furloughed employees in the company. An agreement must be made between the employer and employee in writing. There is no guidance on the set amount of days employees can work part time and be on furlough leave.
Until July 31, employers can still claim 80 percent of the employee’s salary of up to £2,500 including National Insurance and pension contributions. The hours in which the employee works part time must be paid by the employer and cannot be claimed through the CJRS.
If you do not wish to use the flexible scheme you can still use the pre-existing furlough arrangements until October 31 2020.
Cap on Claims
Up until June 10, employers were able to enrol unlimited numbers onto the CJRS. This has now changed and employers are limited to the number of employees they can claim for. The maximum number has been capped at the highest amount you claimed between March and June. For example, if you have claimed three times at the values of 10, 20 and 40 you will now be capped at only furloughing 40 employees. Employers will still only be able to make one claim for any period, so you will need to include all furloughed or flexibly furloughed employees in one claim, even if they are paid at different times.
Claim periods starting on or after July 1 2020 must start and end within the same calendar month. As the scheme rules are changing monthly, claims cannot overlap calendar months. So, separate claims will have to be submitted for each month where a pay period includes days in more than one month, or where a furlough period overlaps two months.
Claims for periods ending on or before June 30 must be made by July 31.
Three Week Rule
As of July 1 2020 employers will be able to furlough employees for any amount of time. However, you will only be able to claim in minimum blocks of seven calendar days. Although there is no minimum furlough period after July 1 2020, any claim must be made in respect of at least one week (unless claiming for the first or last few days of the month).
- From August 2020 employers must pay National Insurance and pension contributions, the scheme will no longer fund these payments.
- From September 2020 the amount reclaimable will drop to 70 percent, with an employer obligated to top up to at least 80 percent, or what is outlined in your existing Furlough Leave Agreements. If you need to change the amount being paid – for example, dropping from 100 percent to 80 percent of pay whilst furloughed you MUST enter into consultation with employees.
- There will be a drop to 60 percent payable through the scheme in October 2020 with the employer again required to top up to at least 80 percent.
- The scheme will close on October 31 2020.
- The final point is the last date you could have placed an employee onto Furlough Leave was June 10 2020. You are no longer able to furlough new/additional employees, unless they have are returning from statutory maternity or paternity leave.
Natasha is an HR Advisor within JCP's HR Services team. The team provide outsourced HR support and ongoing advice and guidance to the firm's business clients. Natasha also delivers training on HR topics and in recent months has been focussing on furlough leave and business restructuring as a result of the Covid-19 pandemic for local businesses.