Across the UK, people are being advised to work from home if possible, pushing some businesses to lay off workers or to consider short-time working arrangements.
Rather than making any knee-jerk reactions, however, employers should take the time to understand exactly what the latest changes mean for their organisation and familiarise themselves with the available support.
While helpful to many, the government’s support packages have been in some cases difficult to interpret, and have left employers scrambling for last minute legal advice to avoid falling foul of the rules. Therefore, it is important to stay attuned to the advice and guidance as it is released, as this will allow employers to ensure they can protect themselves and their workforce for the future.
Further reading
Furlough scheme extension: is it too late to save jobs in a second lockdown?
Hot topic: The politics of furlough, part two
Furlough scheme masks true scale of UK unemployment rate
The furlough scheme, also known as the Coronavirus Job Retention Scheme (CJRS), has now been extended to MArch 2021 and the government will return to paying up to 80% of an employee’s wages (up to a maximum of £2,500).
This will mean delaying the recently announced, and slightly less generous, Job Support Scheme (JSS) until the extended furlough scheme comes to an end. For businesses, particularly those in Tier 2 that have been caught between a rock and a hard place, the added support may provide a lifeline.
The nature of the furlough scheme means that employees are retained by the employer, who must continue paying the employee’s national insurance and pension contributions. Employees should remain at home and not complete any work which generates an income for their employer.
Under the current CJRS, however, flexible furloughing will be allowed in addition to full-time furloughing; the calculation for usual working hours will follow the same methodology as is currently used under the CJRS.
It is important to note, however, that furloughed employees are allowed to take part in volunteer work, as well as undertaking training, so long as the work does not provide services to or generate revenue for the organisation.
Employees who are union or non-union representatives may also undertake duties and activities for the purpose of individual or collective representation of employees, or other workers, while furloughed.
The scheme is available to all UK employers, regardless of size, including businesses, charities, recruitment agencies (where agency workers are paid through PAYE) and public authorities. Guidance on how to claim can be found on the GOV.UK website.
It’s also worth noting that, under the extended scheme, neither the employer nor the employee needs to have previously used the furlough scheme and there is no minimum time for a worker to be placed on furlough leave, however, in the employee’s case they must be on an employer’s PAYE payroll by 23:59 30th October 2020 to be eligible under this extension.
When submitting a claim to HMRC to recover furlough wage costs, it must cover a period of at least seven calendar days, unless a claim is being made for the first or last few days in a month.
While the difficult circumstances of the lockdown may force some employers to make redundancies, they must ensure their HR teams have all the resources and support they need to protect people’s livelihoods.
Any employees who are made redundant while on furlough leave will be eligible for both redundancy (where they have longer than two years’ service) and statutory notice pay, based on their normal wages and not the furlough rate.
Regardless of the increased levels of support, sectors such as retail, hospitality, and leisure still face tough times ahead, with increased restrictions coming at one of the most critical points in the trading calendar.
With details of additional support, for example, the Jobs Retention Bonus, on the way these measures should go some way to helping employers stay afloat over the winter and keep their staff in jobs through the coming months. The question remains: do they go far enough?
Rhys Wyborn, employment partner, Shakespeare Martineau
