Furlough Scheme Update

On 5^th November 2020, the Chancellor announced that the Coronavirus Job Retention Scheme would be extended until the end of March 2021. Although initial details of the extended scheme were set out, the full Government Guidance was only released on the 10^th November.

The guidance largely mirrors the furlough approach taken over the summer months, that is flexible furlough with the government grant covering 80% of hours not worked up to a cap of £2,500 per month. However, there are two novel points which employers ought to be aware of:

• Although the guidance confirms that, as before, employers can claim for a furloughed employee who is serving a statutory notice period, the Government have now stated this approach will change in relation to claim periods starting on or after the 1st December 2020. After writing, further Government guidance was published on 13th November 2020 stating that employers will not be allowed to claim for any days on or after 1st December 2020 during which the employee is serving a contractual or statutory notice period. This also applies to those employees who serve notice of retirement or resignation.
• The guidance also makes clear that as of December 2020, employers’ names and company registration numbers will be published by the HMRC where the employer has made claims under the scheme for the month of December onwards.

Although not novel, there are other points in the guidance which are important for employers to note:

• Where employers are claiming for a period that starts on or after 1 November 2020, they may only claim for furloughed employees that were employed and on their payroll on 30^th October 2020.

• Employers do not need to have previously claimed for an employee before the 30^th October 2020 to claim for periods from 1^st November 2020.

• If an employee was made redundant, or stopped working for the employer on or after 23^rd September 2020, the employee can be re-employed and put on furlough. The employee simply needs to have been employed and on the employer’s PAYE payroll on or before 23^rd September 2020.

• The employer must confirm in writing to the employee that they have been furloughed, and keep a written record for five years.  The employer must also keep records of how many hours its employees work and the number of hours they are furloughed.

• Employees can be retrospectively furloughed with effect from 1st November 2020, provided the agreement to retrospectively claim furlough is put in place on or before this Friday 13^th November. 

Should you need assistance navigating the extended furlough scheme, please contact the Clarkslegal Employment team.