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Coronavirus Job Retention Scheme

The government has released further information and clarification regarding the eligibility and particulars of the Job Retention Scheme.

Below we have included a summary of some of the key points regarding the way in which the Scheme will work.

  • Employers will be entitled to a grant from HMRC equal to 80% of monthly wage costs up to £2,500, plus National Insurance Contributions and minimum pension contributions on that wage.
  • You will need to apply for any grant through an online portal system. The government hopes to have the system up and running and in place by the end of April.
  • As a reminder, claims can be backdated to 1st March 2020 but only employees who were on the PAYE payroll on 28th February 2020 shall be eligible.
  • Employers have the option to top up an employee’s salary beyond the 80% grant, but is not an obligation under the scheme.
  • To be eligible to make a claim under the scheme, you must have sent written confirmation to your affected employees, confirming that they have been furloughed and you should keep a copy of this.
  • Employees must be furloughed for a minimum of three weeks and the scheme is to be open for up to three months, but this may be extended.
  • You can only submit a claim once every three weeks.
  • Any UK organisation shall be eligible provided they had a payroll in place on 28th February 2020 and a UK bank account.
  • Administrators working through administrations can also apply.
  • Employees on any type of contract shall be eligible, whether that is full-time; part-time; agency or flexible/zero hours.
  • Any staff made redundant after 28th February 2020 will also be eligible provided they are rehired.
  • During the furlough period, employees must not undertake any work for, or on behalf of, the organisation.
  • Wages received during the furlough period shall continue to be subject to the usual income tax and other applicable deductions.
  • The employment contract must be varied by agreement, confirmation must be made in writing to the employee and a record kept of this communication.
  • Equality and discrimination laws will continue to apply to those being furloughed and during the furlough period.
  • Those employees on sick leave or self-isolating should receive SSP but may be furloughed after this. Those shielding in line with public health guidance can be placed on furlough.
  • A furloughed employee is able to take part in volunteer work or training, provided they do not provide services to, or generate income, for or on behalf of the organisation.

The above is a summary of some of the key aspects of the latest guidance.

The full government guidance can be found by clicking here.

If you have any questions about furlough or need assistance implementing it with your staff, please contact our employment team on 01603 620508.

This article was produced on the 1st April 2020 by our Employment team for information purposes only and should not be construed or relied upon as specific legal advice.