Coronavirus Job Retention Scheme

Employers are keen to find out how they can access the Coronavirus Job Retention Scheme since the Chancellor's announcement. At present, there is little information as to how utilise the scheme, but here's what we know so far.

Which employers can access support?

The Coronavirus Job Retention Scheme allows all employers access, whether you are a; sole trader, partnership, Ltd Company or LLP (depending on if they have employees who would have otherwise been laid off during the COVID-19 pandemic. The employee must be sent home and classed as on furlough leave (the measures outlined will be available for backdating to March 1st 2020).

Can an employer force an employee to be put on Furlough?

Simple answer, yes. It depends on if the employer has a clause in the contract which allows them the right to introduce lay off, or short time working.

If you do not have such a clause in your contracts, you will then need consent. This is where things get a bit sticky, as if the employees choose to refuse to go on Furlough, the employer has the right to make the employee redundant.

How to select Furlough

As advisors, our opinion would be to use a shortened version of redundancy selection. Acas has a more in-depth article on how to select employees for redundancy, but the main principles are to choose based on:

  • standard of work
  • skills, qualifications or experience
  • attendance record (do not include absence relating to disability or maternity)
  • disciplinary record)

80% or 100% for Furlough employees?

This is entirely up to the employer whether they want to top up your wage from the Government backed 80% and fulfil 100% of your wages or not. Although, employees could claim there to be deductions in wages - a claim which an employer may lose. We believe these to be very small chances, but never the less, we advise you to get written consent from the employee to agree terms of Furlough.

If an employee refuses to go on Furlough, can an employer make them redundant?

As long as a fair process has taken place to determine redundancy, then yes an employer may make their employee redundant.

4 Step Process for getting Furlough money back

At the moment (24th March 2020), the government are still setting up a portal for employers, it however, has not gone live yet - we'll update this section when it does.

  1. Select the employee(s) for Furlough
  2. Gain written consent to pay 80% of their contracted wage
  3. Give written notice for the employee to go home
  4. Once the government portal goes live, register for the 'Furlough Pay'

Are there any limitations to this scheme?

  • Furlough pay will be 80% of employees normal wages
  • A cap of £2,500 (p/m) will be in place. Figure being paid to employee, not the normal wage.
  • Cap includes NI  and pension contributions

Still have more questions?

If you still have questions about the Coronavirus Job Retention Scheme that this article didn't cover, you can find more information on the governments advice article all about COVID-19 support for businesses.

Or you can contact us today for a free consultation:

Read Something Interesting? Contact Us To Learn More

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form