06 April, 2020
HMRC has, over the weekend, updated its guidance on the Coronavirus Job Retention Scheme (CJRS).
The updated guidance has provided some clarity to previously uncertain areas and has also confirmed a number of issues that were otherwise assumed to be the case. It has however changed some of the previous guidance and has also introduced some new guidance.
The main points that can be taken from the updated guidance are as follows:
- Apprentices can be furloughed in the same way as other employees.
- Employees made redundant, or who otherwise ceased to work for a company on or after 28 February 2020, can be re-employed and put on to furlough leave. This includes employees who voluntarily resigned and in theory anyone who was dismissed for any other reason. There is however no obligation for employers to do this.
- Employees who are self-isolating or on sick leave are entitled to receive SSP during this period and during this time cannot be furloughed. They can subsequently be furloughed and claimed for under the scheme once they are no longer receiving SSP.
- Employers can claim for furloughed employees who are shielding in line with public health guidance (or who need to stay at home with someone who is shielding) if they are unable to work from home.
- Employees can start a new job whilst on furlough - provided this is allowed for under the existing contract of employment and/or agreed.
- The 80% that can be claimed back under the scheme now includes compulsory commission (i.e. contractual commission). The previous guidance excluded commission payments. Please note that this will still be subject to the cap of £2,500 per employee per month.
- The 80% now also includes fees, which were also previously excluded under the guidance. There is however no guidance on what amounts to a 'fee'. As above, the £2,500 cap still applies.
- Discretionary bonus or commission payments however are not included, nor are tips or benefits in kind (i.e. private health insurance and company car payments).
- Company directors who are salaried can be furloughed - they can provide no work during this period other than to perform their statutory duties.
- Employees can be furloughed multiple times - provided each period of furlough is for a minimum of at least three weeks. This is now expressly provided for under the updated guidance.
- Employers must notify employees of their furlough status in writing (previously there was no requirement for this to be in writing) and a record of this written notification must be kept for five years.
- Employers who receive public funding for staff costs should use that money to continue to pay staff, rather than furloughing.
The full updated guidance can be found at www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme?mc_cid=177bacbc11&mc_eid=10779720e5.
Despite this update there are still a number of issues that remain unclear including the position on taking annual leave during furlough leave.
For more information contact Abigail Lynch in our Employment & HR department
via email or phone on 0330 207 4469.
Alternatively send any question through to Forbes Solicitors via our online Contact Form.