A new way of furloughing was announced by the chancellor on 29th May, with the government now promoting maximum flexibility. More details will be released on 12th June and the scheme is still due to close on 31st October. However, this is what we know so far:
· The scheme will close to new employees on 1st July
· Consequently, employees who have not been furloughed before, must be furloughed by 10th June for at least 3 weeks.
· Employers can continue to both furlough employees and bring them back to work again depending upon business requirements, as long as employees who have not been furloughed before are furloughed for a straight 3 weeks by 10th June.
· It is advisable to keep a clear record of who has been furloughed and the date that they were furloughed from.
Flexible Furlough from 1st July:
· Employers will be able to furlough employees on a part-time basis.
· Employers will be required to pay employees their normal full-time rate for any hours that they work.
· The hours and days worked can change each week.
· There is no restriction on the amount of flexibility with employees being able to work as little as a day.
· Employees can still be furloughed 100% of the time if needed.
· It remains the company’s right to decide who is furloughed, depending upon business requirements and also being mindful of any potential grounds of discrimination.
What employers will be able to claim:
· Employers can claim a grant for any hours that the employee is normally contracted to work, but instead is not working and is remaining on furlough.
· The number of employees being claimed for any claim period cannot exceed the maximum number claimed for any previous claim period.
What employers should agree in writing with employees:
· Employers should obtain employees’ written agreement to move them onto flexible furlough.
· Employers should provide employees with reasonable notice of being moved onto flexible furlough. This should be in line with any agreement that was reached when the employees were originally furloughed.
· Actions should also be taken in line with any short-term working clause in the employment contract.
What employers should report and document going forward:
· Employers should report the hours actually worked by each employee, and the hours that the employee would normally be expected to work in the claim period.
· Employers and employees should retrospectively agree in writing the hours worked the previous week.
· Employers can use a simple clock in and clock out procedure to record the hours worked. It may be useful to introduce timesheets for this purpose should they currently not exist.
The Grant will start to decrease
The employee will continue to receive 80% of their wages for any hours not worked, however the percentage paid by the Government will decrease over time as detailed below.
Employer pays 100% of hours worked.
Government pays 80% of hours not worked. Capped at £2,500.
Employer pays 100% of hours worked plus employer NICs and pension contributions for hours not worked.
Government pays 80% of hours not worked. Capped at £2,500
Employer pays 100% of hours worked plus employer NICs and pension contributions for hours not worked, and 10% of wages for hours not worked up to £625.
Government pays 70% of hours not worked. Capped at £2,187.50
Employer pays 100% of hours worked plus employer NICs and pension contributions for hours not worked, and 20% of wages for hours not worked up to £625.
Government pays 60% of hours not worked. Capped at £1,875.
What Employers should now be considering:
1. Who needs to return and why.
2. Whether you have any redundancy proposals.
3. Whether to ask for volunteers to return to the workplace
· Clarify how this may impact on any future redundancy selection pools.
4. Any selection process to determine who returns:
· The criteria you might apply.
· Consult with unions / employee representatives.
· Transparency and relationship with any future redundancies.
5. Health and safety legislation regarding any physical premises.
6. A timeline including when to write to employees which should be as soon as possible.
7. Any concerned employees may find it useful to return to the workplace for an hour to understand the health and safety changes that have been introduced before returning fully.
Kerris Crook HR Consultancy
Please do contact Kerris Crook HR Consultancy should you require assistance with furlough or any forthcoming redundancies.