The Covid-19 virus has caused unprecedented disruption to all areas of life, including the economy and standard working practices. The social distancing advice and lockdown measures that have been put in place mean that it’s increasingly difficult for certain sectors to work safely or function as normal.
In response to this global challenge, the UK government has had to propose its own set of bold economic interventions in order to help companies to navigate such difficult times.
A major part of the proposals put together by the Chancellor, Rishi Sunak, has been introducing furloughing, which essentially means that an employer continues to have an employment relationship with an employee, but the employee is not required to work and the employer doesn’t have to pay them during this time.
This is a temporary measure to prevent an employer ending a work relationship with an employee during the coronavirus. The Coronavirus Job Retention Scheme means that the government will cover 80 per cent of the employee’s wages up to £2500 per worker for up to 3 months from 1st March 2020. The scheme is 3 months in the first instance, but as the situation is ongoing, this will be revisited by the government.
The HMRC furloughing portal is now live and APS Global can make a manual submission to HMRC including the employee details, the amounts reclaimed and your company bank details for HMRC to make the refund.
Here are some of the main details about furloughing, but read our comprehensive Coronavirus Guide here.
- There must be a genuine case for furloughing and HMRC will check this and look for companies exploiting the situation.
- Employees are furloughed from the date you informed them they would be furloughed by writing to an employee, officially informing them.
- After this point, employees must be furloughed for a minimum of 3 weeks and then your company can revisit this every 3 weeks if necessary. If there’s a need for them to come back after less time than this due to a pick-up in business then they can do so but you cannot reclaim the funds paid to them.
- Full time, part time, zero hour and temporary workers can be furloughed as long as they were on the payroll on 28th February 2020.
- You don’t have to furlough all workers, only when you have no work for them to do and they would’ve been let go by your company/made redundant otherwise.
- Once staff have been furloughed, they must not continue to work for your company and generate any business during this time, however few hours.
- Your company can only furlough an employee receiving SSP after they have ended their own self-isolation and on their first day back at work.
- Workers on parental leave must still be paid as normal, in full. When someone returns to work they can then be furloughed.
- A company director can furlough themselves, based on PAYE earnings, but must not do any work that generates business for the company.
We know this is a difficult and stressful time and if you have an queries or questions about furloughing, get in touch with our team by phone, between 10.00am until 2.00pm on +44 (0)161 850 1177 or email us at firstname.lastname@example.org and we will endeavour to get back to you as soon as we can.