From 1 July, employers can bring staff back on a part-time basis whilst still being furloughed for the hours they are not working. Employers will now need to pay for the employees’ hours worked and claim through the Coronavirus Job Retention Scheme (CJRS) for those where they are furloughed. From August, employers will be asked to contribute to wage costs up until the scheme ends at the end of October.
We have answered some of the most common questions we have been asked:
Can I bring an employee back part-time for a week and then furlough them full-time again?
Yes, there is now no minimum time period for bringing back employees from furlough. You can also bring staff back part-time and put them back onto full time furlough if the workload dictates. Previously there was a requirement to furlough staff for a minimum of three weeks at a time but under the new guidance this has been removed.
How do I calculate the salary and furlough claim?
The calculations are complex and we would recommend speaking to an HR consultant from the outset to understand how these will work. You will need to calculate an employees’ usual hours. Before you calculate you will need to know:
- the length of your claim period
- what you can include when calculating wages
- your employees’ usual hours and furloughed hours
When claiming for employees who are flexibly furloughed you should not claim until you are sure of the exact number of hours they will have worked during the claim period. This means that you should claim when you have certainty about the number of hours your employees are working during the claim period.
Look at the guidance for more information and speak to your consultant.
How do you calculate ‘usual hours’?
This is going to vary depending on whether the employee has fixed contractual hours (so their pay does not vary based on the hours they work) or variable hours.
If they work variable hours, then their usual hours are calculated based on the higher of:
- the average number of hours worked in the tax year 2019 to 2020 up until the day before they were furloughed, or the end of the tax year if earlier
- the hours worked in the corresponding calendar period in the tax year 2019 to 2020.
This needs to include any hours of paid leave in the period where the employee received full pay and any overtime hours where pay was not discretionary. There is now a calculation for working out both hours so please contact your consultant for more guidance.
Can my claim cover more than one month?
No, claims must not straddle more than a calendar month. So for example, a claim for July would have to cover 1 – 31 July and can’t include any dates for June (which it could have previously).
Do I need to issue a new furlough agreement to the employee?
Yes, a new agreement is required which states the terms and conditions on which the employee is returning to the workplace. This will need to be in writing and kept for at least five years. Get in touch for a furlough agreement template letter.
What are the rules for those staff still on full time furlough?
Staff who are not being brought back on flexible furlough, and who will remain in full time furlough are still not permitted to undertake any work for the business. They can however still take part in voluntary work or training.
What about staff who have already agreed to reduce their hours or reduce their salaries, would they be eligible for flexible furlough?
Those employees who have not been furloughed and have remained working, but with reduced hours would not be eligible for the scheme. In order to qualify, they would need to have been placed on furlough at some point prior to 10 June.
When do employers need to start contributing to the wage costs?
- From 1 August, employers will be required to pay employee’s national insurance and pension contributions. This will no longer be claimed through the CJRS.
- From 1 September, the CJRS will only reimburse 70% of salaries (up to a maximum of £2,187.50). This means employers will be required to top up to 80% (or more depending on what has previously been agreed).
- From 1 October, the government will reimburse 60% of salary (maximum cap of £1,875) – requiring employers to continue the top up to 80%.
- The scheme is scheduled to close on 31 October 2020.
Can I furlough new staff?
No, the last date for adding employees to the scheme was 10 June so it’s now no longer possible to furlough any new staff. The only exception to this rule is employees returning from statutory parental leave after 10 June. These employees would be eligible to be furloughed for the first time, as long as the employer has submitted a claim for any other employee for at least three consecutive weeks between 1 March and 30 June. Look at the government’s ‘who can be furloughed’ guidance.
Can an employee still work for another employer during flexible furlough, or get a new job?
The rule still applies to employees that they are able to work for another employer whilst on furlough, even if they are working on a flexible furlough basis.
What are the claim periods under flexible furlough?
Despite there being no minimum claim period from 1 July, to make a claim with HMRC employers are asked to use a minimum of seven (calendar) days. There is an exception to this when the claim period includes either the first or last day of the calendar month and the claim is for the period ending immediately before it. In these cases, the claim can be for fewer than seven days.
How many employees can you claim for?
The new guidance has introduced a new maximum number of employees for which employers can claim. From 1 July, this number cannot exceed the maximum number of employees on furlough at the same time in any period prior to 30 June.
What can I do if an employee refuses to return to work?
If an employee refuses to return to work when requested, it will be important to understand the reasons and any underlying concerns. We would advise speaking with one of our HR Consultants for advice as there are various options open to the employer to manage this situation.