COVID-19 UPDATE: New guidance regarding extended furlough arrangements

So we now have the Government’s furlough scheme, formally known as the extended Coronavirus Job Retention Scheme (CJRS), back until 31st March next year. However, now that we also have further guidance on this, there are some differences to the previous scheme that employers will be wise to note. We summarise these below.

The Government has agreed to pay 80% of wages for the period from 1st November 2020 to 31st January 2021, subject to a cap of £2,500 per month. The scheme will then be reviewed in January 2021 to decide whether employers will be required to make a contribution as they did previously when the percentage paid by the Government reduced over time to 60%, subject to a revised cap per month.

Earlier this week we also had further guidance in the form of several documents, including ‘Check if you can claim for your employees’ wages through the Coronavirus Job Retention Scheme’, ‘Check which employees you can put on furlough to use the Coronavirus Job Retention Scheme’ and ‘Calculate how much you can claim using the Coronavirus Job Retention Scheme’. Particular points to note in this guidance include:

• The extended scheme is open for employees who were employed on 30th October 2020, as well as employees who were made redundant or stopped working on or after 23rd September 2020 if they are then re-hired.
• Employers do not need to have previously claimed for an employee before 30th October 2020 to claim the furlough payment for periods from 1st November 2020.
• Employers can furlough employees for any amount of time and any work pattern, while still being able to claim the grant for the hours not worked. In other words, what we came to know as ‘flexible furlough’ is still possible.
• Employers can continue to claim for periods ending on or before 31st October 2020 until the deadline on 30th November 2020.
• There is no maximum number of employees that an employer can claim for from 1st November 2020.
• Employees returning from maternity leave need to give the statutory eight weeks’ notice to end maternity leave early in order to be furloughed on their return.
• The ‘Check which employees you can put on furlough’ guidance states that “…the Government is reviewing whether employers should be able to claim for employees serving contractual or statutory notice periods and will change the approach for claim periods starting on or after 1 December 2020, with further guidance to be published in late November”. This statement is of particular significance to employers who are considering dismissing any employees and hoping to continue to have them on furlough for their notice period so that at least some of the notice payment can be claimed by way of a furlough payment under the scheme. If you are one of these employers you should ensure that you give notice to your employee(s) before 1 December 2020 regardless of the reason for their dismissal.  NOTE:  Further guidance has since confirmed the position for employees serving contractual and statutory notice periods – see our latest blog.
• HMRC are also intending to publish the names of those employers who are claiming furlough as part of its measures to try and reduce fraud in relation to the scheme. The latest guidance states specifically: “From December 2020, HMRC will publish employer names for companies and Limited Liability Partnerships (LLPs), the company registration number of those who have made claims under the scheme for the month of December onwards.”

As before, employers must obtain their employees’ consent to vary their hours of work and pay and record this agreement and the fact they that have agreed to be furloughed in writing. HMRC also require employers to keep the written record for five years.

It is also possible to back date a furlough agreement to 1st November 2020 provided that you have the written agreement in place with the relevant employee by no later than this Friday, 13th November 2020.

To read the latest guidance click HERE.

Please get in touch if you have any questions regarding the issues discussed in this article.

E: enquiries@jma-hrlegal.co.uk / T: +44 (0)1252 821792