Furlough and Job Retention Scheme Q&A

 In some cases, where work has ceased because of the coronavirus lockdown, your employer might ask if you want to be furloughed. Information on what that means for you can be found below.

What if my employer is considering layoffs or redundancies?

As a result of the coronavirus crisis, many workplaces have been closed and employees have been asked to work from home if they can. However, some jobs cannot be done from home and some employers have therefore considered lay-offs and redundancies. The UK government has announced details of the Coronavirus Job Retention Scheme.

Employers can use this scheme to retrain their staff until they can reopen for business, rather than make staff redundant. They can ‘furlough’ employees and apply for a grant that covers 80% of their usual monthly wage costs.

UNISON has produced guidance for negotiators that can found here:

Job Retention Scheme Bargaining Guide

What is a furloughed worker?

To access the Job Retention Scheme employers need to designate affected employees as ‘furloughed workers,’ and notify their employees of this change.

Furloughed workers are unable to work because their workplace has been forced to close due to the coronavirus.

if you are furloughed, this will change the status of your employment relationship – your contract. This change in employment status remains subject to existing employment law and, depending on your employment contract, may be subject to negotiation.

Who decides whether someone is furloughed?

An Employer decides who is to be furloughed. In choosing staff to be furloughed, Employers will have to consider discrimination laws and the implied duty of ‘mutual trust and confidence’. Employers are likely to seek volunteers.

As this will require a variation of an Employee’s contract, an Employee’s consent is required before they go on furlough.

Can I work while on furlough?

No, you cannot work and you cannot provide services or generate income.

Who can be furloughed?

Subject to some conditions and exceptions, employees and workers can now be furloughed if on PAYE at 19 March 2020.  Previously, the key date was 28 February 2020.

The scheme applies to employees on an organisation’s payroll at 19 March that are any of the following:

  •  full-time employees,
  •  part-time employees,
  •  employees on agency contracts
  • employees on flexible or zero-hour contracts.
  • employees who were made redundant since 28 February 2020, if they are rehired by their employer.

What if I have caring responsibilities?

Employees who are unable to work because they have caring responsibilities resulting from coronavirus can be furloughed. For example, employees that need to look after children.

What if I am shielding for health reasons?

If an employee is not on sick pay but instead is shielding for health reasons they will be eligible for furlough pay.

What is the minimum period for furlough?

The minimum period is three weeks.

Can my employer rotate staff on and off furlough?

Yes, employees can be rotated – three weeks on furlough and the working three weeks.

What pay will I receive?

Full-time or part-time employees will be paid 80% of their actual salary (as at 28 February 2020), up to a maximum of £2,500 per month. The wages covered do not include fees, commission and bonuses.

What if my pay varies month to month?

For employees whose pay varies and have been employed for 12 months prior to the claim, an employer can claim and pay the employee the higher of:

a) the same month’s earning from the previous year;

or b) the average monthly earnings from the 2019-20 tax year.

For employees whose pay varies but they have been employed for less than a year, the claim should cover the average monthly earnings since they started work.

Can my employer pay me below the National Minimum Wage if I am ‘furloughed’?

The government has stated employees on the National Minimum Wage (NMW) can be paid less than this usual legal minimum. They say that the NMW does not apply to furloughed employees. However, if employees are required to engage in training activity, such as completion of an online training courses, whilst they are furloughed, they must be paid at least the NMW for the time spent training.

Will my furlough wages be subject to income tax and deductions?

Yes

 

Will my employer still make National Insurance and minimum automatic enrolment pension contributions?

Employers remain liable for associated Employer National Insurance contributions and minimum automatic enrolment Employer pension contributions on behalf of furloughed employees and can claim for these costs from the Government in addition to the wage.

What if I have more than one job?

Employees with more than one job can be furloughed for each job. Each job is separate, and the cap applies to each employer individually.

Can I do volunteer work/training if I am furloughed?

Yes, so long as the volunteer work/training does not provide services to or generate revenue for, or your Employer.

If you complete online training courses while you are furloughed, you must be paid at least the full National Living Wage (NLW)/National Minimum Wage (NMW) for the time spent training, even if this is more than the 80% of your wage that will be subsidised.

Will a company in administration be able to access the JRS?

Yes.

Further details on government guidance on this issue can be found here 

If you have been notified by your employer but are unclear then you should contact the branch by calling 07375 88 14 38, or email us on [email protected]

Date Online: 27/04/2020

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