Job Retention Scheme
Please find below more information from our friends at 360HR. Things are still changing fast but this is our latest understanding:
- In order to get agreement to ‘furlough’ an employee we are not required to carry out a 3 stage consultation process. We simply need to ask the employee whether they would agree to it. If they say ‘yes’, that’s it done, but we do still need to confirm it with them in writing. This is a sample Furlough Agreement, it looks reasonably straight forward but if you need help tailoring it firstname.lastname@example.org has offered to help.
- If you still have redundancies to make, either right now or in the future, you could agree to furlough your employees for now and then carry out a proper 3 stage redundancy consultation with them whilst they are furloughed. If you have 20 or more redundancies to make, this would allow you to consult for the 30 or 45 day statutory period required.
- We still don’t know if you should retract dismissals that have already taken place but the feeling from the webinar yesterday was that this is unlikely. I will let you know as soon as this becomes clear.
- The furlough arrangement might be applied on a daily, weekly or monthly basis – it is thought that weekly is the most likely. This might allow you to furlough your staff on a rotation basis. For example, if you have 3 people doing the same work but you only have sufficient work for one person, instead of furloughing 2 people and requiring 1 to stay at work, you could rotate the work on a weekly basis between all 3 of them. We will let you know as soon as this has been clarified.
- Company directors will equally be entitled to be furloughed but they will only receive 80% of any pay that is paid to them via the PAYE scheme.
- Holiday will continue to accrue whilst an employee is furloughed but an employer can require an employee to “take” some of their holiday entitlement during the furloughed period so that they don’t return to work half way through the holiday year with a full years’ holiday entitlement still to take. As normal, however, you would have to give twice as much notice as the duration of holiday you wish them to take.
- Although the Government will ultimately reimburse you 80% of the employees’ costs, as a business you need to pay that money to your employees in the meantime. If you will not have sufficient cash reserves to cover this, you can agree with your employees to pay them a lower amount, say 50%, whilst you are waiting for the government funding to come through. This agreement would state that on receipt of funds from the government you will backpay the additional 30% that they are entitled to and pay the full 80% from that point onwards.
- If you cannot rotate furlough arrangements and need to select between employees as to who will remain working and who will be furloughed, you do need to use a fair selection process in the same way you would if you were making people redundant.
- If an employee has two or more part time jobs, it is feasible that they could be furloughed from one job whilst continuing to perform their other job(s). They cannot, however, carry out any work during the hours that they have been furloughed. That is likely to be fraud.
- An amendment to the Coronavirus Bill is going through the system at present to provide support to self-employed people. It is likely to be agreed. It will provide either a) 80% net earnings based on an average of the last 3 years or b) £2,917 pcm, whichever of these two is the lower.
The latest word on the street is that the CJRS probably won’t be live for 2-3 weeks yet.