Government Updates The Coronavirus Job Retention Scheme - Again!
Toni Robinson, Managing Director of NucleusHR provides an update for employers and shares advice on how this will affect their businesses
The Government has published a further update to its guidance on the Coronavirus Job Retention Scheme in the past few days, which you may not have spotted. The new guidance offers clarity to furloughing those who are ill, on sick leave or being shielded. It also extends to those that were TUPE transferred after 28th February 2020.
There are an awful lot of questions that remain unanswered, which is only to be expected with the pace at which this scheme was made available to employers, however, NucleusHR can provide you with the following update for now:
Employees who are unable to work because they are shielding in line with public health guidance (or need to stay home with someone who is shielding) can be furloughed. The requirement that they need to have been at risk of redundancy in order to be eligible for furlough has been removed.
Employees who are currently on long–term or short-term sick leave can be furloughed for business reasons. The individual should be classified as a furloughed employee and they will then receive furlough pay under the Scheme. The two-week SSP rebate scheme is not available whilst an employee is furloughed, since the employer instead makes a claim for a contribution to salary costs via the Job Retention Scheme. Please remember that furloughing is not intended for short-term absences from work for sickness, particularly given that there is a three-week minimum furlough period.
If an employee becomes sick whilst furloughed, you can decide whether to keep them on their furlough rate or move them onto SSP. If the employee is moved onto SSP, the employer can no longer claim for the furloughed salary through the Scheme. Employers are required to pay SSP themselves, although some employers may qualify for a rebate for up to 2 weeks of SSP.
Where a TUPE transfer has taken place after 28 February 2020, the new employer can furlough the TUPE’d employees.
The employer National Insurance Contributions and pension contributions that can be reclaimed are based on the furlough salary, not normal salary. Employers must pay all money received under the Scheme which relates to pension contributions to the pension scheme as an employer contribution. (Note that the Pensions Regulator has also published new guidance for employers about automatic enrolment and pension contributions in relation to issues that might arise from the current emergency).
Overseas nationals working on all categories of visa can be furloughed, grants under the Scheme are not counted as ‘access to public funds’.
The furlough pay for employees returning from family leave after 28 February 2020 should be calculated based on their salary, before tax, not the pay they received whilst on statutory leave. Claims for such returners who have variable pay should be calculated using either the same month’s earning from the previous year or average monthly earnings for the 2019-2020 tax year.
The whole grant from the Scheme referable to the employee’s pay must be paid to an employee in the form of money. The grant cannot be used to pay for the provision of benefits or a salary sacrifice scheme, nor can you agree with employees to reduce the amount paid them, for example by charging an administration fee
You can now claim for furloughed employees that were on your PAYE payroll on or before 19 March 2020 and which were notified to HMRC on an RTI submission on or before 19 March 2020.This means an RTI submission notifying payment in respect of that employee to HMRC must have been made on or before 19 March 2020.