The Coronavirus Job Retention Scheme (the ‘Scheme’) opened for claims on 20 April 2020. By way of a quick re-cap, the key features of the Scheme are.
- The employer must agree with the employee that they are a furloughed worker to be eligible;
- Employees must be notified that they have been furloughed;
- Employees must be furloughed for a minimum of three weeks;
- The employee cannot do any work for the employer that has furloughed them;
- The employer can claim 80% of wages up to a maximum of £2,500 per month per furloughed worker plus employer National Insurance Contributions and pension contributions (up to the level of the minimum automatic enrolment employer pension contribution);
- A separate claim is needed for each PAYE scheme;
- Employers can only claim for furloughed workers that were on the employer’s PAYE on or before 19 March 2020;
- An RTI submission notifying payment in respect of the furloughed worker to HMRC must have been made on or before 19 March 2020;
- The employer must have a UK bank account.
The Scheme is accessible via the Government Gateway and in order to access the Scheme employers will need:
- A Government Gateway ID and password
- An active PAYE enrolment
If an employer is furloughing 100 or more employees, then they will need to provide additional information including the furlough start date and end date (if known).
HMRC has indicated that it intends to verify and pay the amount claimed within six working days of a claim being made, which will be welcome news to employers.
In advance of the launch of the Scheme HMRC has published a step-by-step guide for employers claiming through the Scheme. See here
In addition, the general Government guidance on the Coronavirus Job Retention Scheme has been updated. It is worth noting that there is now some very useful additional guidance which sits behind the links on the main guidance page. For example, there is guidance on how to calculate 80% of a furloughed worker’s wages. See here
Holiday & Furlough leave
This additional guidance relating to wage calculation includes a section on holiday and holiday pay which now confirms that:
- A furloughed worker can take holiday whilst on furlough; and
- Furloughed workers should be paid their “usual holiday pay” for any annual leave taken during furlough i.e. holiday pay should be based on pre-furlough normal remuneration.
This provides welcome clarity for employers on an issue that has remained unaddressed until now. It also confirms that those employers who did not ‘top up’ the wages of furloughed workers for periods of holiday taken over Easter should seek to rectify that in their next payroll cycle to avoid potential unlawful deductions from wages claims.
The Geldards Employment Team is happy to help you with any queries you may have relating to the Coronavirus Job Retention Scheme or in general. Contact us here.