As the UK went into a second lockdown earlier this month, Chancellor Rishi Sunak confirmed that the furlough scheme would be extended. Find out how it applies to you and your employees…
Although the second UK lockdown is set to end at the beginning of December, Rishi Sunak has recognised that companies may be affected for longer than that and has therefore extended the Coronavirus Job Retention Scheme (CJRS) until the end of March 2021.
Like the original scheme, which was set up in March, the current plan will see the government paying 80% of employee’s wages, with a cap of £2,500 a month. The Chancellor said that his aim was to give businesses security over the winter period and to protect millions of jobs.
The scheme replaces the Job Support Scheme, which had initially been planned to be put in place once the first Furlough scheme came to an end, and it is good news for employees as this new plan is far more generous.
How does it work?
Employers are able to claim 80% of an employee’s salary for any hours not worked with a cap of £2,500 a month. You must confirm in writing to your employee that they have been furloughed and a written record of this must be kept for five years.
Who can be furloughed?
You must have been employing the member of staff on 30 October 2020 (and you must have made a PAYE RTI submission to the HMRC notifying a payment of earnings for them at any time between 20 March and 30 October 2020). This does not apply if you are employed as a member of staff after 23 September 2020.
It is important to note that you do not have to have made any claim on the furlough scheme before 30 October 2020.
How many employees can I claim for?
The extended furlough scheme has no upper limit on the number of employees you claim for and you are not limited to the staff that you claimed furlough for during the first lockdown in March.
What about staff on maternity leave?
If you have staff on maternity leave, who would rather be furloughed (because that pay will be higher than Statutory Maternity Pay), they must give you eight weeks’ notice to end their leave early.
I employ an apprentice, can they be furloughed?
Yes they can, and they can continue their training while on furlough, However, note that they must be receiving wages that are at least the same as the Apprenticeship Minimum Wage/National Living Wage/National Minimum Wage while they are training. So as an employer you must cover the shortfall between that amount and the amount you can claim for their wages.
I made my employee redundant…
If employees stopped working for you or were made redundant on or after 23 September 2020, it is possible to re-employ them and put them on the new furlough scheme.
There are a variety of rules for different employment conditions, you can check them here [GOV.UK: Check which employees you can put on furlough to use the Coronavirus Job Retention Scheme 14/05/20 Updated 19/11/20].
If you would like to discuss this subject further, please contact Cecily Lalloo at Embrace HR Limited.
T: 01296 761288 or contact us here.
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Based in Aylesbury, Buckinghamshire, Embrace HR Limited supports business owners who do not have their own HR department or those that do but need help from time to time. We also work across the Home Counties of Oxfordshire, Bedfordshire and Hertfordshire, and also SMEs based in London.