Trying to keep up with all the government announcements and furlough options is a full time job in itself.
Over the weekend that the government announced that the UK will start a new period of lockdown from Thursday 5th November for 1 month. The new legislation that supports this has not been agreed yet, and needs to go through parliament, so expect the full details later in the week.
However, until then we know that those of you who will need to close or reduce your operations will be keen to get on with this and let staff know what is happening. Therefore, we have set out below what we know so far.
- Extended CJRS. The furlough scheme that was due to end on 31 October 2020 has now been extended and will run through until ‘December’. We are presuming initially to the 2nd December 2020, but the actual dates have not yet been confirmed. The JSS will be postponed and will start when the CJRS extension ends.
- Terms of extended CJRS. This is being extended based on the terms that were in place in August 2020. The Government will fund up to 80% of a furloughed employee’s current salary for hours not worked (calculated by reference to their usual hours worked in a claim period), up to a maximum of £2,500 per month. Employers are only being asked to cover NICs and employer pension contributions for the hours the employee does not work. As before, the grant must be paid to the employee in full.
- Full and flexible furlough. In addition to full furlough, flexible furlough is still available if you want to reduce hours rather than stop work altogether. If you are using flexible furlough, you will need to continue to pay the employee for hours worked in the usual way (and will need to pay tax, NICs and pension on those amounts as normal).
- Top ups. You can top up employee wages above the CJRS grant at your own expense if you wish, but there is no requirement to do so.
- Employer requirements. To be eligible, employers must have a UK bank account and a UK PAYE scheme. However, this time around, you do not need to have previously used the CJRS which is a change. As before, publicly funded organisations will not be expected to use the scheme.
- Employee requirements. Employees will be eligible if they were on your payroll as of 23:59 on 30 October 2020 (and a RTI submission must have been made by that time too). This means that new starters etc. will be covered. Employees must be furloughed for a minimum of 7 consecutive days. As before, employees can be on any kind of contract.
- Calculations. We understand these will be broadly the same as before you will need to report hours worked and the usual hours an employee would be expected to work in a claim period.
- Written agreement. For those employees who are not currently on furlough, you will need to seek their agreement to be furloughed as before. For those currently on furlough, you can send a letter confirming the extension. Whilst the second lockdown is not due to commence until Thursday 5 November 2020, the government has confirmed that there will be no gap in eligibility for support between the previously announced end-date of CJRS and this extension. The government will shortly confirm when claims can first be made in respect of employee wage costs during November. It is presumed that at first customers will need to pay the costs out and then will be reimbursed but when the government has adjusted its system, the grant will then be paid upfront as it was before.
- Shielding. The government has confirmed that during lockdown those who are clinically extremely vulnerable should work from home and if that is not possible, they should not go to work and may be eligible for Statutory Sick Pay (SSP). Those employees in this category should receive a letter confirming the government advice. Again, we are awaiting further guidance on this.
- Working from home. The messaging from the government is that during lockdown employees should work at home if possible. We know that in some situation’s employees may want to come into the workplace if they cannot work effectively from home for reasons such as inadequate workspace or mental health reasons. We would suggest that if you do decide to keep the workplace open for certain employees that you document the reasons why working from home is not possible in each individual circumstance.