Last call for furlough, no new furloughs from 10th June

(2nd June 2020) As expected last week the Chancellor announced changes to the furlough scheme:

  • From 10 June only employees previously furloughed may continue to be furloughed – no new furloughs will be allowed.
  • From 1st July furloughed employees will be allowed to do some part time work – employers can still claim for the time they are furloughed and not working (but will pay them in full for the work they do.) This will require amendments to furlough agreements in place.
  • From 1st August employers can no longer claim Employer’s NICs and pension contributions.
  • From 1st September furloughed employees will still receive 80% of their salary up to a maximum of £2,500 per month, but the scheme will cover 70% of the amount, employers will have to pick up the other 10%.
  • From 1st October employees will still receive the 80% up to £2,500, but the scheme will reduce to 60% with employers paying the balancing 20%.
  • On 31st October the furlough scheme comes to a close.

 

Employers should now be urgently reviewing their business and deciding (before 10th June) whether anybody else needs to be furloughed.

Furlough agreements should also be updated – myHRdept customers should contact their advisors to discuss furlough, unfurlough and redundancy plans – please don’t leave this until the last minute as demand for our services remains high.

Further guidance is expected on 12th June, but we have tried to anticipate some obvious Q&As below. Obviously these are speculative – we won’t know for sure until the new guidance arrives in 10 days.

Can I continue to furlough employees I’ve already furloughed after the 10th June?

Yes.

Can I furlough employees I haven’t furloughed before after 10th June?

No.

Can I re-furlough employees who are currently working but who have previously been furloughed (after 10th June)?

Yes, we think so.

When I have to pick up a proportion of the costs from August, can I simply agree with my employee to pay them less?

No, we don’t think so. We think the rules will make it clear that the employee must receive the same as before.

If I decide to make my employee redundant, can they serve out their notice on furlough pay?

There are conflicting opinions on this point – some think that pay should be at full contractual pay.

 

 

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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