Kent Invicta LIVE: Furloughing – Job Retention Scheme Webinar Recording

21st April 2020
Paul Brooks

On Tuesday 21st April, Kent Invicta Chamber of Commerce’s board member, Andrew Metcalf hosted a webinar with guest speakers;

Catherine Daw from Brachers LLP who provided an overview of the support available to help employers and your employees deal with the economic impacts of COVID-19 and Alyson Howard from MHA MacIntyre Hudson, who discussed crisis management around the Job Retention Scheme and how to manage business cashflow.

See the full recording below.

For all other unanswered questions, the Kent Invicta Chamber of Commerce is delighted to be delivering via The Kent & Medway Growth Hub on behalf of Kent County Council and Local Authorities at this difficult time a Covid -19 Business helpline for all Kent businesses. The helpline is open Monday to Friday 8.30am to 5.00pm: 03333 602300.

“Thank you so much! Can I just add that I have attended plenty of these sessions on Furlough – this one was one of the best ones if not the best one. The more practical advice we get in the business the better and this one was definitely very practical!”
Jo Rychlik, Head of HR, The Superior Healthcare Group

Questions and Answers

Q1 – Can you be furloughed from 2 companies?

Assuming an individual has two separate roles and the companies referred to are not linked employers, an individual can potentially be furloughed from both. The government guidance for employees states:

If you currently have more than one employer.

You can be put on furlough by one employer and continue to work for another. If you’re put on furlough by more than one employer, you’ll receive separate payments from each employer. The 80% of your regular wage up to a £2,500 monthly cap applies to each job.

If you have had multiple employers over the past year, have only worked for one of them at any one time, and are being furloughed by your current employer, you cannot be furloughed by your previous employer.

I would add that one client with employees who had two separate contracts, one which they could get furlough support for and one they could not (Government funded), they sent the employee home entirely and only claimed under the JRS for the job that was eligible for furlough.

Q2 – Do you have to wait for 3 weeks before you can furlough employee

No – the minimum furlough period is 3 weeks but during the period of the scheme (and providing the other qualification requirements are met), you do not need to wait to place someone on furlough.

Q3 – If you are shielding with a dependant or partner (dependant or partner got letter from NHS) can carer be furloughed?

Yes, individuals who are carers for someone who is shielding can be placed on furlough.

Q4 – You just mentioned taking holiday whilst on furlough – I understood that wasn’t possible – could you clarify, please?

The ACAS guidance (https://www.acas.org.uk/coronavirus/using-holiday) and latest CJRS guidance (https://www.gov.uk/guidance/check-if-you-could-be-covered-by-the-coronavirus-job-retention-scheme) clarifies the position. The Government guidance for employees indicates:

You can take holiday whilst on furlough. Working Time Regulations (WTR) require holiday pay to be paid at your normal rate of pay or, where your rate of pay varies, calculated on the basis of the average pay you received in the previous 52 working weeks. Therefore, if you take holiday while on furlough, your employer should pay you your usual holiday pay in accordance with the WTR. Employers will be obliged to pay the additional amounts over the grant, though will have the flexibility to restrict when leave can be taken if there is a business need. This applies for both the furlough period and the recovery period.

Q5 – Is the extension to end of May?

The CJRS now runs until the end of June.

Q6 – Will you be covering maternity leave?

Sorry we didn’t cover this during the session. Guidance can be obtained from the following link:

https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme#employees-you-can-claim-for
Maternity effectively stays as it is. If the person has said they are going to come back at the end of the maternity pay period and that is whilst the company is on close down, you can put them straight onto furlough. Also don’t forget that they are accruing holiday pay whilst on MAT leave so you could also ask them to tag on that leave at the end, it will still cost you, but it avoids them returning with lots of undertaken holiday when you want to get up and going again.

Q7- Do you have to get the permission from an employee in order to Furlough them? What happens if they refuse?

In most cases, the safest course of action when placing an individual on furlough is to obtain agreement. If an individual refuses, an employer may need to consider a potential redundancy if there is not enough work for an individual to do. Employers are likely to need legal/HR advice if this is the route being followed.

Q8 – If you are a director of a ltd company and the only employee of the company and work contracts have been put on hold, can you put yourself on furlough?

The guidance below makes it clear directors can potentially be placed on furlough. No work can be undertaken, although statutory functions can be completed:
https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme#employees-you-can-claim-for

Q9 – If an employee is furloughed and there is a bank holiday is this taken as a deduction from annual leave is it paid at the normal rate of pay

In many cases, if individuals normally do not work on bank holidays, this can be taken from annual leave entitlements and would be paid at the normal holiday rate of pay.

Q10 – As a single director of a company, can sub-contractors still work for the ‘company’ but the director be furloughed?

Potentially, yes, although as above the director would not be able to work and this would include giving instructions to sub-contractors.

Q11- Do the furlough scheme apply to apprenticeships?

Yes, additional guidance has been included in the updated provisions which can be accessed via the following link:
https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme#employees-you-can-claim-for

Q12 – If you have weekly and monthly paid employees, do you use the monthly or weekly periods when claiming?

It is one claim per period. So, for every weekly payroll you have a claim for that week and for every monthly payroll you have a claim for that month. You must claim them separately, so if you have lumped them all together you might get queries raised, but it is too soon to know.

Q13 – Do you claim for April in May or June?

You can claim for April in April if you have run the payroll and have the figures to hand. You can always claim for an imminent payroll run. Currently if you claim by 22nd April you should have funds by 30 April 2020. If you know that you are furloughing your workforce in May you can run that payroll so it is ready to claim at the beginning of May.

Q14 – If your payroll is weekly do you have to do 3 weeks at a time or can you make a separate claim for each week. Also if you have monthly and weekly paid staff can you or do you process this separately.

You need to run a separate claim for each week and another one for monthly paid staff. We are conscious of some software forcing groups of three weeks at a time so you should speak to your provider if that is the case. You don’t have to wait, you can post all the claims on one day, we just don’t advise lumping them altogether in one claim.

Q15 – A question I have relates to pay awards. In light of the NMW increasing would it be acceptable for other employees to receive a cost of living pay award even though they are furloughed?

Furlough amounts are referenced to pay in February which is before the rate went up. If you want to top it up because you fear discrimination in the future you can, but you won’t get that portion funded by the JRS.

We don’t yet know if, someone was working in April and had been paid at the new NMW rate, whether they would be furloughed at that rate rather than the earlier one. We will watch this space; at the moment you must look at February but that may change.

Q16 – Do you know why we are not claiming for 3% on gross furlough amount on employers pension

Continued .. We deduct £520 before calculating 3%
Continued.. Following on from Andrew’s question re: the Pension calc on gross pay, the guidance states to deduct £520 first, could you please confirm?
Continued.. Thank you for the acknowledgement, but our pension scheme is total earnings does this mean I can claim 3% on gross furlough amount

You do have to take off the £520 (from April onwards, for March salaries it was £512) before calculating the 3%, even though not all pension schemes require that. The NEST scheme is based on qualifying earnings which means you do it on absolutely everything including overtime, but you can then take off the lower earnings limit before calculation the 3%. HMRC will only reimburse on the qualifying earning (NEST alike) basis, even if your scheme does not work like that. So, you will have to cover any extra if your scheme does requires the deduction before calculating the 3%

Q17- Can you make 2 claims in one day? (So, March and then April)

Yes, one claim per payroll event so can be four weekly payrolls and two monthly payroll periods all in one day if that is what you want.

Q18 – If I’m a lone director of a limited company (i.e. the only member of staff) on PAYE can I furlough myself (I have an accountant that does my payroll)

As above, directors can be furloughed.
But you cannot do anything in the way of working including looking for new business or anything other than basis and they have to be so carful they are not posting on social media or doing anything relating to their business other than basis statutory requirements. We are making sure we running the payroll monthly to keep things tidy.

Q19- I have a staff should have started in April but due to the COVID 19 I have to stop can I furlough that staff to keep them?

If these individuals were not employed on 19 March (and therefore assuming an RTI submission had not been made for them by this date) unfortunately you cannot place them on furlough.

Q20 – So to clarify we can claim the pension as per how our schemes are ordinarily processed?

No as above per questions 16, for the JRS HMRC has said they will only reimburse on the rates for Nest like schemes, you will have to make up nay difference.

Q21 – Do I group 3 weekly periods in one claim or do i have to do 3 separate claims?

You must do three separate claims if it is three weekly payroll runs.

Q22 – Can you confirm that we can claim the Pension Contributions if we do not have the Auto-Enrolment Pension but a Group Pension Scheme?

You can claim reimbursement on the basis of the Nest scheme, so that is what you can claim for, and this will mean some further calculations, but what you pay your pension provider will not change, you will have to make up any difference.

Q23 – As a furloughed employee can you work for another company, if so what are the rules around this?

As above, it has now been clarified that individuals can do other work (not for their employer or a related employer) during periods of furlough although in many cases, an employee will need to get their employer’s consent to this.

Q24 – What happens if an employee refuses to come back after being furloughed?

An employer’s response will need to take into account an individual’s reason for not wanting to come back for example, is this because they are now sick, are they self-isolating or shielding, are they concerned about risks associated with returning etc. An employer will therefore need to find out these reasons before deciding on a way ahead.

Ultimately, if an individual does not have a good reason for not returning then their absence may be deemed to be unauthorised and potentially disciplinary action may be taken.

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