Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner. Facebook Messenger An icon of the facebook messenger app logo. Facebook An icon of a facebook f logo. Facebook Messenger An icon of the Twitter app logo. LinkedIn An icon of the LinkedIn logo. WhatsApp Messenger An icon of the Whatsapp messenger app logo. Email An icon of an mail envelope. Copy link A decentered black square over a white square.

SPONSORED: Coronavirus Job Retention Scheme – your questions answered

Post Thumbnail

The UK Government recently launched the Coronavirus Job Retention Scheme (also known as Furlough Leave) as a way for employers to get “support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis”.

Deborah Miller, Partner at leading law firm MacRoberts, answers some of the most frequently asked questions about the scheme and what employers need to do to access it.

Which employers are eligible to access the scheme?

Any UK organisation with employees can apply for the scheme, provided that they have created and started a PAYE payroll scheme on or before 28 February 2020, and have a UK bank account.

However, the Government’s expectation is that the scheme will not be used by many public sector organisations on the basis that the majority of these employees are providing essential services or their salaries are already publicly funded.

Which employees will be eligible?

The scheme only applies:

1.       To employees who were on the PAYE payroll on 28 February 2020

Employees on unpaid leave cannot be furloughed, unless they were placed on unpaid leave after 28 February; however, employees who have been made redundant since 28 February can be included, provided they are re-hired by the employer. The definition is wide and includes employees on agency contracts and flexible or zero-hours contracts. The scheme does not apply to those who are self-employed but a separate similar scheme has been introduced for them.

2.       If the employee is not undertaking any work for the employer

The employee must not carry out any work for on behalf of the employer, meaning that employees who are working but on reduced hours are not eligible. Employees are able to undertake training and do volunteer work, provided that they do not provide services to or make any money for their employer.

3.       Where employees are on Furlough Leave for three weeks or more

Furlough leave must be taken in minimum blocks of three weeks to be eligible for funding.

What process will employers need to follow?

1.       Decide which employees it is proposed to place on Furlough Leave.

If not all of the workforce is to be placed on Furlough Leave, care must be taken, and fair process followed, to determine which employees will remain at work and which will be on Furlough Leave. For example, it will be important to ensure that any decisions are not discriminatory.

2.       Notify selected employees of the proposed change of status to “furlough worker” and seek their agreement

In the vast majority of cases, the employer will not be able to unilaterally impose a change of worker status to “furlough worker”. In most cases, employee consent will be required. This means that most employers will be required agree the change with employees to agree the designation.

In the current unusual circumstances, it is anticipated that many employees will agree to this change. However, employers will also need to consider what steps they will take in the event that agreement is not reached.

There will then be a formal process of notifying the employees in writing of their designation as a furlough worker.

3.       HMRC submission

The final step is submitting details about the Furloughed Workers and their earnings to HMRC. This will be done through an online portal. This has not yet been set up.

Can employees insist on being placed on Furlough Leave?

No, employees cannot unilaterally choose to be placed on Furlough Leave – the agreement of their employer will be needed.

What payments will employees receive under the scheme?

HMRC will reimburse 80% of furloughed workers’ wage costs, up to a cap of £2,500 per month, plus the associated employer NICs and minimum auto-enrolment pension contributions on that wage. Importantly, fees, commissions and bonuses are not included.

Do employers have to pay the remaining 20% of the salary?

There is no automatic right for employees to be paid the remaining 20% of salary not covered by the scheme; however, this topic may form part of the negotiations with employees when agreeing their change of status.

How long will the scheme last?

The scheme is backdated to 1 March 2020, open for at least three months, and will be extended if necessary.

Will employment rights continue to accrue during Furlough Leave?

Employees will remain employed during Furlough Leave and will retain their length of service.

How do we find out more?

Further information about the scheme and government guidance for employers and employees can be found at https://www.gov.uk/, and MacRoberts’ specialist Employment Law team can answer any questions you may have on your business’s particular circumstances. You can also find out more at their special Covid-19 page.