Coronavirus Job Retention Scheme – Updated information with effect from 6th April 2020.
We will keep clients updated once we have had sight of the additional guidance on the Extended CJRS and, presumably, a further Treasury Direction to implement the extension.
Over the Easter Weekend, the Government published a further update to its guidance on the operation of the Coronavirus Job Retention Scheme (CJRS). Furloughed directors and owner-managers can continue carrying out statutory duties but must not generate commercial revenue or provide services to their own business, or other businesses. He called on people to report suspected furlough fraud via HMRC’s online fraud reporting page here. From November the government will pay the 80% but the employer must still cover the employees' NI and pension contributions.
Furlough reclaim = £1000 /80% * 70% = £875.00, Furlough pay = £1000.00. July, any future CJRS claims must be for calendar months only and cannot span different months, for instance 6, For both newly furloughed employees and those previously furloughed and claimed for, you have up until the 31, July to make a claim for any periods of furlough up until the 30, Employers must start contributing for the wage costs of paying furloughed employees.
Answers to frequently asked questions around furlough leave, Watch a video of our webinar on furlough leave, As we face the ongoing impact of the coronavirus pandemic, the CIPD is collating and publishing updated resources to support your response, © Copyright Chartered Institute of Personnel and Development 2020, 151 The Broadway, London SW19 1JQ, UK Incorporated by Royal Charter, Registered Charity no. We will be updating this page regularly. making it easier to calculate what you can claim back from the government, using the Coronavirus Job Retention Scheme.
This means they must have previously been furloughed for at least 3 consecutive weeks taking place any time between 1 March and 30 June 2020.
From 1 August 2020, employers will be asked to contribute towards the cost of their furloughed employees’ wages. The employee section of the guidance adds that employees can be furloughed if their employer has no work for the employee to do or where an employer is unable to operate. You should contact HMRC to amend your claim. If the employee has received furlough pay only in the selected date range, then the Employer’s NI reclaim is: The calculation becomes more complex if the employee was not furloughed for the whole period: If the employee was not furloughed for the whole period AND also received a top up payment, then the above steps are followed plus a further step: For example: Employee was furloughed on 15th April. Employers must start contributing for the wage costs of paying furloughed employees.
This also applies to those who live with someone who is clinically highly vulnerable or who have caring responsibilities resulting from coronavirus. The legal position is different concerning what is permissible under the scheme, and the employer's normal ability to restrict working elsewhere: Furloughed employees can work for their employer part time under the second and third most recent phase of the scheme; staff will be paid normally by the employer (who must not claim furlough pay for the hours staff work). Changing the status of employees always is subject to existing employment law so it’s important to bear this in mind. Decided whether to pay 80% of salary or to supplement it. Calculate your claim for pension contributions – claim periods up to and including 30, Deduct the minimum amount your employee would have to earn in the claim period to qualify for employer pension contributions – this is £512 a month for periods before 5, April 2020, and £520 a month for periods after 6, Calculate your claim for pension contributions – claim periods from 1. The government’s objective has been for research to continue or recommence wherever possible, and research settings were included in the guidance on safer working published on 11 May. However, if they were paid differently you will need to choose one, say the 6th July to 5th August, and remember to make manual changes later on the spreadsheet described below to remove pay from 1st to 5th August but add pay from 1st to 6th July from the previous payslip. Under the latest extension to furlough the government pay 80% of furloughed employees wages up to a cap of £2,500 for hours not worked. The recommended way is to use the Furlough Payment payslip item the 80% Furlough Payment. The scheme has also been extended beyond June. If the employee is only furloughed for part of the month the system will pro-rata the calculation to apply to the number of days the employee is furloughed, based on the dates you entered. If you cannot maintain your workforce because your operations have been affected by coronavirus (COVID-19), you can furlough employees and apply for a grant to cover a portion of their usual monthly wage costs where you record them as being on furlough. actual hours worked for flexibly furloughed employees. Similarly to the above, if your employees are weekly paid you will need to ensure for any weeks that go over the end of a calendar month the pay is split between two different claims. The public sector organisation would then have to confirm this with both the contractor’s Personal Service Company (PSC) and the fee-payer and agree between the parties that the contractor will not carry out work for the organisation during the period of furlough. In this situation employers would then have to pay the holiday pay in full and could claim for the 80% grant towards this. Similarly, apprentices should receive at least the National or Apprenticeship Minimum Wage or the National Living Wage. National Insurance contributions thresholds, £169 per week, £732 per month or £8,788 per year, Start with the relevant secondary NICs threshold that corresponds to the pay period, Divide by the number of days in the pay period, Multiply by the number of days in the furlough or flexible furlough claim, Divide by the number of usual hours in the flexible furlough claim, Multiply by the number of furloughed hours in the flexible furlough claim, Start with the amount you are claiming for the employee’s wages, Deduct the relevant adjusted secondary NICs threshold, Working out what you can claim – for claim periods starting on or after 1. Keep on top of the latest changes to the coronavirus job retention scheme here: https://www.gov.uk/government/publications/changes-to-the-coronavirus-job-retention-scheme/changes-to-the-coronavirus-job-retention-scheme, Coronavirus job retention scheme: supplementary guidance for research organisations. If you would like our assistance, please complete the following form and we will prepare this for you. Detailed guidance on the earnings that count towards the £520 a month average minimum earning threshold is expected to be published in September 2020.
The fee-payer will then need to pay the furlough payment in respect of wages to the PSC via PAYE and make the necessary tax and NIC deductions.
For more information see the FAQs on national insurance and pensions. Only employees in respect of whom you have successfully made a claim will be eligible for more grants under the scheme.
HM Revenue & Customs will provide you with a sum equivalent up to 80 per cent of each furloughed workers’ total wage costs, up to a limit of £2,500 a month, for three months initially, backdated to 1 March 2020.
If you have claimed too much or if you want to delete a claim in the online service, you must do this within 72 hours.
If you have made an error that has resulted in receiving too little money, you will still need to ensure you pay your employees the correct amount.
Full guidance on the extended scheme is expected to be published imminently. if an employee normally gets £1000 per month and you are paying them £800 furlough pay, the reclaim value in October will be £600.
This will be equal to the amount overpaid, or not used within a reasonable period to make furlough payments to employees or to cover associated costs. The Chancellor stated that in June and July the furlough scheme will continue as before, but employers will be asked to cover National Insurance and employer pension contributions in August.
Note: If an employee is in more than one pay period in the claim period, each pay period’s data must be entered in a different row. Claims for this second round of grants have a deadline of 19 October.
Download a copy of the spreadsheet and associated guidance from the link at the top right of the Furlough Payment Claims page. DISCLAIMER: The materials in this guidance are provided for general information purposes and do not constitute legal or other professional advice. Keeping in touch with key customers or suppliers is permissible if purely social but it could amount to work even if personal emails are used. When claiming the CJRS grant for furloughed hours employers will need to report and claim for a minimum period of a week. General legal position on working elsewhere.
At the same time, it confirms that there must be a written agreement between the employer and the furloughed employee “that the employee will cease all work in relation to their employment”.
Coronavirus Job Retention Scheme (CJRS) extended until October. As you are increasing the amount of your claim, they need to conduct additional checks.
HMRC advises that employers wishing to claim the bonus should ensure that their employee records are up to date and that they are reporting employees’ details and wages on the Full Payment Submission (FPS) through RTI submissions. It says that the pages will be updated shortly to tell employers when they can claim the extension; and (ii) the rules relating to the extension. Employees cannot undertake any work for you during time that you record them as being on furlough. The employer has agreed to top up the furlough pay so that they receive 100% of salary whilst furloughed. Employees were only prevented from doing any work but only for the same employer that has furloughed them up until the end of June.
Extended furlough scheme grant
For more information see: https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme?utm_source=b8bc2614-b5a2-4841-ad9b-e3255de6c543&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate, Government clarifies furlough scheme stance for employers. Administering the Coronavirus Job Retention Scheme. Under the more flexible second and third phase extensions to the furlough scheme (from July to October and then to end of March 2021) employees may either cease working completely or work reduced hours. Fourth Grant: covers January 2021 to April 2021. Employees who are currently off sick can be furloughed for business reasons and moved from Statutory Sick Pay (SSP) to furlough pay. This means that the final date by which an employer needs to agree with their employee and ensure they place them on furlough is 10 June. After following the steps to make a claim online, employers should ensure they take a note of their claim reference number (as there won’t be a confirmation email). Telephone contact between team members is also permissible as long as no work is undertaken. Government extends Furlough to March 2021.
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