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Update on the furlough scheme

By Jackie Fletcher | 22 September 2020

For those of you who jumped on the furlough scheme rollercoaster prior to June, it appears (at the time of writing) that we are approaching the end of the ride. After many twists, turns and updates, the expected end date is 31 October 2020 and employers will then need to decide whether to bring their employees back to work on their normal hours, reduce their employees’ hours or to sadly end their employment. More on this in a moment.

Firstly, let’s look at the scheme itself. We are now well into flexible furloughing, where a part-time working pattern can be arranged with employees. They should be paid in full for the hours that they work and the remaining time is counted as furlough, with a minimum pay of 80% of usual salary. August saw a reduction in the amount of furlough grant that can be claimed, with employers no longer able to claim for employers’ NI or pension contributions. Now we are into September, the government will only pay 70% of furlough pay, with the employer expected to top up 10% to ensure that employees receive their minimum 80% furlough pay. The grant will drop further to 60% in October, with employers picking up a minimum of 20%. Employees MUST be paid the full 80%, although the employer is still free to top up to 100% if they choose.

HMRC guidance advises that all records relating to the furlough scheme should be kept for six years. This will include details of all claims, including the details of your employees’ flexible furloughing hours.

HMRC have also published guidance on what to do if you have over-claimed under the furlough scheme. It is now possible to delete a claim within 72 hours if you discover an error. If this deadline is missed and you are unable to make an adjustment in your next claim, then you should contact HMRC directly to arrange repayment. The deadline for reporting over-claims is either 90 days after the date you received the over-claim or 20 October 2020, whichever is later. Financial penalties will be applied, so it may be a good time to check that your claim calculations are accurate and that a change in recent circumstances does not mean that you are no longer entitled to a grant previously claimed.

The latest guidance can be found here: Government Guidance on the COVID-19 Job Retention Scheme.  

Towards the end of July, the Chancellor announced that a Job Retention Bonus (JRB) will be available to employers who have furloughed employees, brought them back to work and they are still on the payroll at the end of January 2021, having earned a minimum average of £520 per month from 1 November to 31 January.

The bonus will be £1,000 per employee, and further details of this scheme can be found here: Government Guidance on the Job Retention Bonus.  

Finally, we do need to address the difficult issue of what to do if there is not enough work for your employees to return to when the furlough scheme ends. Obviously we hope and pray for a happy ending, whereby employees are able to return to their work as before. However, where the same job no longer exists, it can be a painful and uncertain time for all concerned. In this situation, many people’s thoughts go straight to redundancy. However, it is it is good to consider other possibilities before taking this route. In our employment webinar that was held on 23 June 2020, employment lawyers at Edward Connor Solicitors, Mark Jones and Gemma Herrick, discussed alternative approaches to redundancy. They also outlined helpful resources should redundancy be the remaining option once other avenues have been exhausted.

If you find yourself in this situation, then do listen to the recording which can be found, along with links to the associated resources, here: COVID-19: Update on the Furloughed Employee Scheme - Stewardship.   


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Claim for wages through the Coronavirus Job Retention Scheme

Job Retention Bonus

COVID-19: Update on the Furloughed Employee Scheme

Posted by Jackie Fletcher

Jackie is the Treasurer Services Lead at Stewardship. Having worked in the Payroll Bureau since September 2016, she now co-ordinates our Payroll Bureau, Charity Formation and Consultancy Helpline teams. Prior to this, she was a primary school teacher and has also been involved in charity finance and administration for over nineteen years. She is passionate about supporting Christian charities, enabling them to focus on mission and ministry, and in her spare time she volunteers for a charity that works with the homeless. She is a fan of family, friends and food.

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