Covid 19 Employees
Updated Furlough Guidance
Further guidance was published over the weekend of April 4 in regards to the Coronavirus Job Retention Scheme and issues regarding the Government’s furlough scheme.
Employee updates and taking on another job
Whilst furloughed staff can’t do any work for the employer that furloughed them, employees can start a new job when on furlough and can also undertake training, work on a self employed basis or as a volunteer.
Employers can also agree to re employ employees and place on furlough. They’ll still be able to claim a grant to cover 80% of the regular wages, up to a monthly cap of £2,500 if you were on your employer’s PAYE payroll on February 28, 2020.
You can reclaim 80% of compulsory commission from HMRC plus basic salary, excluding non monetary benefits. This does however only refer to commission from past sales. This is because furloughed employees of course cannot be completing new sales when on furlough.
Company directors can be furloughed but not perform what would be considered normal work for the firm, only statutory duties.
There isn’t a rule on only furloughing an employee once; for example, they can be furloughed, brought back to work, then re
Employees must be notified in writing, with the record of that notification kept in writing for five years. The employer must mutually agree with the employee that the employer is designating them as furloughed (there is no work for them due to COVID 19) and what the employer is planning to pay them whilst furloughed.
Which Employees Are Covered?
HMRC also confirmed over the weekend that the following individuals are covered
• Employees on any type of employment contract including zero hours, flexible, part time or fixed term.
• Office holders (including company directors) but only on their PAYE income.
• Salaried members of Limited Liability Partnerships (LLPs).
• Agency workers (including those employed by umbrella companies).
• Apprentices (make sure you follow the guidance on continuing apprentice training and NMW).
• Nannies and other domestic staff.
• Limb (b) workers i.e. those on PAYE not those who are self employed.
• Not covered are: Deemed employees those subject to the off payroll rules in the public sector. Workers engaged under a
contract for services for example, sole traders being paid gross via an invoice. The Government has released other grants
applicable for sole traders, however, including the Self employed Support Scheme.
• The scheme has been extended until the end of June, while the total cost of the scheme could soar to £40 billion by the time the
initial three month period ends.
Job Retention Scheme Employee Overview
If you and your employer both agree, your employer might be able to keep you on the payroll if they’re unable to operate or have no work for you to do because of coronavirus (COVID 19). This is known as being ‘on furlough’.
Through the Coronavirus Job Retention Scheme, the Government will pay 80% of salary for staff who are temporarily not working due to the virus. Therefore, your employer could pay 80% of your regular wages through the Coronavirus Job Retention Scheme, up to a monthly cap of £2,500.
You’ll still be paid by your employer and pay taxes from your income. You cannot undertake work for your employer while on furlough.
The scheme, announced Chancellor Rishi Sunak, started from March 1, 2020, and has been extended until the end of June to provide clarity amidst the lockdown extension.
For employers to submit a claim for furlough pay for an employee through the scheme, new starters who were on payroll for March 19, 2020 are now included, as opposed to the initial ruling of February 28.
Around 200,000 new starters are now eligible. Employers still need to have included any newly appointed employees on a real time
information (RTI) submission notifying a payment in respect of the employee made to HMRC on or before March 19.
As an employee, you must be notified of the change as an employer officially designates you as a ‘furloughed worker’, and you should not undertake work while furloughed.
Eligibility and Claiming
It’s important to note that you cannot apply for the scheme yourself your employer is responsible for claiming through the Job Retention Scheme on your behalf and for paying you what you are entitled to. Once it has been agreed between you and your employer to put you on furlough your employer must confirm in writing that you have been furloughed to be eligible to claim.
If you haven’t received confirmation, you should contact your employer.
You can find full guidance for specific employee sectors below, including the answers to many questions, including if you do not want to go on furlough.
Government guidance click here
Auto enrolment contributions and national insurance liabilities covered
Employer auto enrolment contributions and national insurance liabilities are also covered under the Coronavirus Job Retention Scheme.
The Department for Work and Pensions has clarified this further to alleviate pressure on employers, stating that it can also be used to claim employer national insurance contributions and minimum auto enrolment employer pension contributions (3%) on that wage. This will alleviate any pressure to suspend auto enrolment contributions and will avoid affecting individuals & longer term finances.
Statutory Sick Pay Employee Overview
Statutory Sick Pay (SSP) is granted from day 1 of an absence rather than day 4 and the Government will reimburse small employers for up to 2 weeks of SSP per eligible employee. You can get £95.85 per week SSP if you’re too ill to work, paid by your employer for up to 28 weeks.
The extended SSP will be available for all those who are advised to self isolate, even if they haven’t yet presented with symptoms.
Eligible employers are those who had less than 250 employees at the end of February 2020. Employers should ask for an isolatin on or sick note, which the individual can complete at NHS 111 online.
The refund will cover up to 2 weeks SSP per eligible employee off work due to COVID
Employers should maintain records of staff absences and payments of SSP, but employees will not need to provide a GP fit note
The repayment mechanism between employers and HMRC has not yet been set up, but it is hoped that this will be in place shortly.
Key essentials to note for employers:
An SME is an employer with fewer than 250 employees and the size of an employer will be determined by the number of people they employed as of February 28, 2020.
People who are advised to self isolate for COVID 19 will soon be able to obtain an alternative to the fit note to cover this by contacting NHS 111, rather than visiting a doctor and can be used by employees where their employers require evidence.
The eligible period for the scheme will commence the day after the regulations on the extension of Statutory Sick Pay to those staying at home/self isolating comes into force.