Extended Furlough Scheme and latest developments 6th Nov 2020

Latest furlough news – 6th November 2020

On 1st November the Chancellor announced that the old CJRS (furlough scheme) would not be switched off after all and, would be extended for a further month, but on the more generous terms that existed in August when the government-financed a qualifying furloughed worker’s wages to a cap of £2,500 per month, and the employer was responsible only for the employment costs of NI and minimum employer’s pension on the furlough wages.

In a surprise announcement yesterday the ‘Extended CJRS’ was extended again until the end of March, with the more generous terms continuing into January, at which point the government will review the economic conditions prevailing, and will decide whether to ask employers to contribute more towards the costs for February and March.

Full guidance will be published in a few days, we include a summary below and the current details directly from the government are available here.

 

Job Retention Bonus and Job Support Schemes suspended

Two consequences of the extension of the furlough scheme are that the Job Retention Bonus and Job Support Schemes are both suspended and in the case of the latter, which was due to start 1st November, we do not expect it will ever come into being.

 

Shielding

The advice on shielding has been updated at the same time:

  • The critically vulnerable list has been expanded to include new health conditions
  • People required to shield will be issued with a new shielding letter as proof for their employer
  • People on that list are advised to work from home if they can
  • People living with a shielding person may continue to go to work
  • If homeworking is not reasonably possible the employer may, subject to eligibility, use the furlough scheme (it will be the employer’s choice, however)
  • In the alternative, SSP may be available.

While employers are not obliged to grant homeworking to a critically vulnerable employee, it would seem risky not to allow them to do so if homeworking is reasonably possible. The chances are that a person classed as critically vulnerable would have a disability (as is defined in the Equality Act) and homeworking where possible would seem to be a reasonable adjustment. A failure to consider reasonable adjustments is likely to amount to a discriminatory act under these circumstances.

You can read the full updated guidance on shielding by clicking here.

 

What we know about the Extended CJRS so far:

  • The extended CJRS will remain open until the end of March 2021 and is open to all employers irrespective of whether they previously furloughed workers
  • Employees will receive 80% of their current salary for hours not worked, up to a maximum of £2,500 per month, though employers may top this up if they choose to do so.
  • For November, December, and probably January, employers will only have to meet the cost of the employer’s NI and minimum pension contributions. This will be reviewed in January and if economic conditions allow employers may be asked to pick up some more of the cost
  • Employees can be fully or flexibly furloughed but must be consistently furloughed for at least 7 continuous days
  • Employers must have a UK bank account and a UK PAYE scheme to claim the grant
  • To be eligible an employee must have been on an employer’s PAYE payroll by 23:59 30th October 2020, and a Real-Time Information (RTI) submission notifying payment for that employee to HMRC must have been made on or before 30th October 2020
  • When claiming for employee’s who have been furloughed under the old CJRS (before November) the employer can revert to the calculations used previously to work out normal hours and pay
  • For fixed salary employees not previously furloughed, 80% of wages should be derived from the pay period before 30th October 2020
  • For variable pay employees not previously furloughed, 80% of wages should be derived from an average of their wages taken from the later of their start date or 6th April 2020 and until the day before their CJRS extension furlough period begins
  • ‘Usual working hours’ for fixed salary employees not previously eligible for CJRS is regarded as their contracted hours in the pay period before 30 October 2020
  • ‘Usual working hours’ for variable hours employees not previously eligible for CJRS is regarded as their average working hours between the later of their start date or 6th April 2020 and until the day before their CJRS extension furlough period begins
  • The grant must be paid to the employee in full.

 

Re-employing the redundant and workers whose fixed terms contracts have expired

The CJRS Extension permits the re-employment of employees who were made redundant after 23rd September, providing they were previously employees on the payroll, and providing an RTI submission was present for those employees between 20 March 2020 and 23rd September 2020.

In the case of fixed-term contracts that expired after 23rd September, these employees can also, subject to the same conditions, be re-employed and furloughed.

When similar allowances to re-employ staff onto the old furlough scheme were published earlier in the year several myHRdept clients reported contact from redundant employees requesting to be returned to the payroll. As was the case then, employers are not obliged to return employees to the payroll and should be mindful of any potential risks from doing so.

 

If you’re thinking of outsourcing your HR or employment law needs, why not contact myHRdept? Call us on 01628 820515 to discuss your requirements or contact us and we’ll call you back.

 

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