Job Retention Scheme
- For periods ending on or before 30th April 2021, you can claim for employees who were employed on 30 October 2020, as long as you have made a PAYE RTI submission to HMRC between the 20 March 2020 and 30 October 2020, notifying a payment of earnings for that employee.
- You do not need to have previously claimed for an employee before the 30 October 2020 to claim for periods from 1 November 2020.
- For claim periods commencing on or after 1 May 2021, employers will now have the option of including employees that were not previously eligible. All employees who have had a PAYE RTI submission made for them between 20 March 2020 and 2 March 2021 can now be included in claims relating to periods starting on 1 May 2021, onwards.
- If you have staff costs that are publicly funded you should use that money to continue paying your staff rather than utilising the Coronavirus Job Retention Scheme.
- You can re-employ anyone you've made redundant and furlough them provided they were still employed and were on your payroll on 23 September 2020.
- For claim periods starting on or after 1 December 2020, you cannot claim for any days on or after 1 December 2020 during which the furloughed employee was serving a contractual or statutory notice period for the employer (this includes people serving notice of retirement or resignation). If an employee subsequently starts a contractual or statutory notice period on a day covered by a previously submitted claim, you will need to make an adjustment.
About the Scheme
- The scheme will now remain open until 30th September 2021.
- There is no maximum number of employees you can claim for.
- The scheme is aimed at employees that cannot do their work as their workplace has closed or there is no longer enough work.
- This means that these employees have to be designated as 'furloughed' in writing and need to stop doing any work for the company in order to be eligible.
- Employees can also be put on 'flexible furlough' in order to work some of their usual hours and be put on furlough for the hours they do not work
- Claim periods must start and end within the same calendar month. All claim periods must last at least seven days.
- You must ensure that you do not discriminate with who is selected for furlough:
- Prioritising vulnerable workers is unlikely to be discrimination.
- Those who do not suffer from serious health conditions are not a protected class meaning they would not establish discrimination if others are prioritised for furlough.
- Employers can furlough employees whose health has been affected by coronavirus (COVID-19) or any other conditions, including if they are unable to work from home, or working reduced hours, because they:
- are clinically extremely vulnerable, or at the highest risk of severe illness from coronavirus and following public health guidance.
- have caring responsibilities resulting from coronavirus (COVID-19), such as caring for children who are at home as a result of school and childcare facilities closing, or caring for a vulnerable individual in their household.
- Employees on sick leave or self-isolating on sick pay cannot be furloughed, but can be furloughed afterwards. Employees who are classified as extremely clinically vulnerable or have caring responsibilities can be placed on furlough.
- Employees on maternity (or similar) leave can continue to draw Statutory Maternity Pay (or similar) payments. The guidance does not prohibit women on maternity leave agreeing to return to work early and then being furloughed, or electing to change to shared parental leave and then being furloughed.
- Furloughed employees are able to undertake training and do volunteer work, provided they do not provide services to or make any money for your business
- Employees still have the same rights at work, including Statutory Sick Pay (SSP), annual leave, maternity and other parental rights, rights against unfair dismissal and redundancy payments.
- From December 2020, HMRC publish employer names and 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.
What You Can Claim
The grant will cover:
- 80% of each furloughed employees' wages up to £2,500 per month for April, May and June 2021.
- In July 2021, employers will be required to contribute 10% of the employee’s 80% furlough pay, with the Government paying for 70% up to £2,187.50.
- In August and September 2021, it will be mandatory for employers to contribute 20% while the Government will contribute at a rate of 60% up to £1,875.
- You’ll still need to pay the employer National Insurance and pension contributions on your furloughed employees’ pay.
- Pay during furlough is taxable in the same way as someone’s usual pay would be.
- Fees, commissions and bonuses are not included in these calculations – just basic salary.
- This is a maximum payment- high earners cannot claim for more. You are able to top up their payment to balance it back to 100% should you decide, but this is not a mandatory requirement. You cannot claim the additional 20% through this or any other scheme.
- For employees whose pay varies, the employer can claim for the higher of (i) the same month’s earning from the previous year (e.g. earnings from March 2019); or (ii) average monthly earnings in the 2019-20 tax year (there are other rules for employees who started more recently).
- Claims must be made to HMRC through the Government Gateway portal https://www.gov.uk/guidance/claim-for-wages-through-the-coronavirus-job-retention-scheme
- Claims must be submitted by 11.59pm 14 calendar days after the month you’re claiming for. If this time falls on the weekend or a bank holiday then claims should be submitted on the next working day i.e claims for December 2020 need to be submitted by 14 January 2021.
The full guidance on the Job Retention Scheme can be found here: https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme
How We Can Help
We have collated some of the key information employers may need and you can also download our free employer resource kit here.
If you'd like advice on the Job Retention Scheme or have any HR questions arising from the coronavirus pandemic, please get in touch via the contact form below.
Stay Safe and Stay Well!