ALL THE ANSWERS YOU NEED ABOUT THE EXTENDED FURLOUGH SCHEME
What changes have been made to the Furlough scheme?
The furlough scheme was due to end on 31 October 2020, however this has now been extended until 31 March 2021. For all claims after 1 November 2020, the government will reimburse the employer for 80% of employees wages up to a maximum of £2,500 per month. The employer is no longer responsible for a proportion of the wages. This contribution is to be reviewed again in January.
Which employers can utilise the scheme?
Employers across the UK can utilise the scheme. Employers do not need to have used the scheme previously, and can claim whether their business is open or closed. However, publicly funded organisations will not be eligible to use the scheme.
What criteria is there for employees?
Employees must have been on the employers payroll on 30 October 2020, and the employer must have made a PAYE Real Time Information (RTI) submission to HMRC between 20 March and 30 October 2020. Employees do not need to have been furloughed under the scheme previously.
Can employees still do some work?
The scheme continues to operate on a flexible basis, therefore employers can use the scheme for any amount of time or shift pattern, furloughing employees on either a part or full time basis. However, any arrangement must be agreed with employees. For the furloughed hours, an employee must not do work for their employer that makes money or provides services, however they can take part in training and volunteer for another employer or organisation. Employees are able to work for another employer under the scheme, if their employment contract allows them to do so.
Who can be furloughed?
The main reason employees will be furloughed is because the business is closed, or is operating on a reduced basis. However, employees can be furloughed where they are unable to work because they are shielding (or need to stay at home with someone who is shielding) or have caring responsibilities resulting from coronavirus, including employees that need to look after children. Employees returning from maternity leave need to give 8 weeks’ notice to end maternity leave early, but then they can be furloughed.
What if an employee is absent due to sickness?
The furlough scheme is not intended for short-term sickness absences. However, if employers want to furlough employees for business reasons and they are currently off sick, they are eligible to be furloughed with other employees. If an employee becomes ill whilst on furlough, they must be paid at least Statutory Sick Pay, but they can continue to be paid in accordance with the furlough scheme.
What if an employee was made redundant before the extension was announced?
Employees can be re-employed and claimed for if they were still employed and on the pay roll on 23 September 2020, and were made redundant or their notice expired after this date. The employer must have made a PAYE RTI submission to HMRC from 20 March 2020 to 23 September 2020 for the employee in question.
Do employees need to be issued with another letter if they have already been furloughed?
Yes. Even if employees were previously furloughed it is likely the end date was 31 October 2020, so all employees whether previously furloughed or not should be issued with a new letter. This written record must be kept for five years.
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