[04.06.20]

From 1 July 2020, businesses will be given the flexibility to bring furloughed employees back part time. Individual firms will decide the hours and shift patterns their employees will work on their return, so that they can decide on the best approach.  The employer will be responsible for paying their employees’ wages whilst in work, with the Job Retention Scheme topping-up the employees’ wages.

From August 2020, the level of Government grant provided through the job retention scheme will be slowly tapered to reflect that people will be returning to work.  At the same time businesses will be asked to contribute, but individuals will continue to receive 80% of their salaries, up to £2,500 per month:

• June and July: The Government will continue to pay 80% of wages up to a cap of £2,500 as well as employer National Insurance (ER NICS) and pension contributions. Employers are not required to pay anything.
• August: The Government will pay 80% of wages up to a cap of £2,500. Employers will pay ER NICs and pension contributions.
• September: The Government will pay 70% of wages up to a cap of £2,187.50. Employers will pay ER NICs and pension contributions and 10% of wages to make up 80% total up to a cap of £2,500. 
• October: The Government will pay 60% of wages up to a cap of £1,875. Employers will pay ER NICs and pension contributions and 20% of wages to make up 80% total up to a cap of £2,500. 

Deadline for Furloughing
From 1st July the Job Retention Scheme will be restricted to employees whose employers have already made a Coronavirus Job Retention Scheme claim.  This includes employees who were furloughed previously, and have since been brought back to work; ie. enabling the employee to be furloughed again if necessary.  As the furlough scheme works in three week cycles, this means the final date by which an employer can furlough an employee for the first time is 10th June.  Employers who have employees they wish to furlough but have not yet done so, must keep a careful record to show that the employee was furloughed on or before 10 June.

Annual Leave
Employees will continue to accrue annual leave whilst they are furloughed.  The employee can take their annual leave whilst they are furloughed.  However, the employee must be paid 100% of their salary for the time that they are on annual leave.  Where this is above the pay the worker receives while on furlough, the employer must pay the difference. However, as taking holiday does not break the furlough period, the employer can continue to claim the 80% grant from the Government to cover most of the cost of the holiday pay.

Castletons Accountants