Job Retention Scheme: Update
As most of the UK clocked off for its Bank Holiday weekend on Thursday 9th April, the government slipped through some further updates to its Job Retention Scheme. We have outlined the key changes below, but we won’t get too carried away: following our update on Thursday 9th April , we still don’t know how annual leave should be treated during furlough leave!
Key updates
- Employees who are being advised by the government to shield can definitely be furloughed if they would otherwise be made redundant and meet with the government’s definition of extremely vulnerable.
- Employees who become ill during a period of furlough leave can be switched from furlough leave to sick leave and back again. Employers must not abuse this right by “helping” employees to receive greater income by furloughing them when they are actually sick.
- Employers can claim back SSP for the first 14 days of absence and make a claim under the Job Retention Scheme for the same employee but not for the same time period.
- Employees on all categories of visa can be furloughed and payment of the grant will not be regarding as a breach of any visa conditions restricting access to public funds.
- A claim under the Job Retention Scheme should take into account the employees wages as at 28th February 2020.
- Employers of employees who have come into their employment via TUPE after 28th February 2020 can place those employees on furlough leave.
- The NI and pension elements which are reclaimable under the Job Retention Scheme will calculated with reference to the furlough salary and not normal salary. Any employers who choose to “top up” a furloughed employee’s wage will obviously need to factor this increased wage into account.
- 100% of the grant claims under the Job Retention Scheme MUST be paid to the employee. The employer cannot deduct anything from the monies received.
- Grant claims must not be used to subsidise redundancy payments.
- It is well-established that employees cannot undertake work for their employer during any period of furlough leave but they cannot undertake work for any organisations that are linked to their employer, either.
- For an employer that takes on a new employee who has been furloughed from another employment, they will need to complete the PAYE Starter Form correctly including Statement C.
- Where a company is being taken under the management of an administrator, the administrator will be able to access the Job Retention Scheme but only if there is a reasonable likelihood of rehiring the workers.
We are constantly monitoring the situation and as soon as further details are released, we will let you know. If you have any questions about these latest developments and how they might affect your business, please contact a member of the Employment Team on 01274 864 999.
