New guidance on part-time furlough
Coodes Solicitors employment specialist Philip Sayers explains the latest Government guidance on the Coronavirus Job Retention Scheme, which details employers’ options for part-time furlough.
Following its recent announcement on the gradual winding down on the Coronavirus Job Retention Scheme (CJRS), the Government has released more information on the next phase of the CJRS, which runs until the scheme ends on 31 October. The guidance includes more detail on the option of putting employees on part-time furlough. Here are the key take-home points for employers.
Potential for part-time working
From 1 July, employers have the opportunity to bring staff back from furlough on a part-time basis. This more flexible approach, which allows any working pattern, will enable employees to work for part of the week and be furloughed for the remainder. Part-time furlough is only permitted for those who were furloughed for a minimum of three consecutive weeks between 1 March and 30 June.
The claim will need to include details of the employees’ usual working hours (based on calendar days) to calculate the number of furloughed hours.
End to the three-week minimum furlough period
Up to 30 June, the minimum length of time for which an employee could be furloughed was three weeks. From 1 July, this will be reduced to seven days. Employers can now claim for up to four periods of furlough a month for a single employee.
Cap on the number of claims
Employers will face a cap on the number of CJRS claims they can make after 1 July. This is limited by the maximum number of claims made at any one time between March and June. So, if 30 was the highest number of staff you had on furlough at any point during the first phase of the scheme, you cannot put more than 30 employees on full or part-time furlough at any one time during this new period.
Exemptions for parental leave
While most employees cannot be furloughed for the first time after 30 June, new guidance is designed to protect the jobs of employees who are due to return from statutory maternity and paternity or adoption leave while the CJRS is in place. These employees can be placed on furloughed leave for the first time, including being put on part-time, flexible furlough, after the cut-off date.
Drop in Government contributions
Employers now need to budget for topping up the Government contributions to furlough pay. The Government guidance, detailed here by HMRC, states that from 1 September, the contribution will be reduced to 70 percent and up to £2,187.50 a month, so employers will have to provide at least 10 percent of a furloughed employees’ pay, up to £312.50 a month. From 1 October, the Government contribution will drop to 60 percent and up to £1,875 a month with the employer expected to pay up to a further £625 a month.
31 July deadline for claims
By 31 July, employers must submit claims for employees who have been furloughed during the period ending or before 30 June. That date is the cut off for employers to claim for the 80 percent furlough pay. After 1 July, claims cannot cross calendar months, so if you have staff on furlough in June and July you will need to submit two claims, even if they were on continuous furlough.