The Government has just released (4th April 2020) further guidance on its job retention or furlough leave scheme.

The key points are:

  • A furloughed employee can work for another employer at the same time as being furloughed. This enables furloughed employees to fill keyworker vacancies (eg. for the NHS).
  • An employer can help a furloughed employee find volunteer work and training opportunities.
  • Employees can’t be furloughed if they are off sick, although they can be furloughed once they return to work after a period of sickness.
  • Employees must be notified that they are being furloughed in writing and employers must keep the written notice for 5 years.
  • Where pay varies, the employer can claim 80% of average earnings through the year or 80% of the money earned in the same month last year.
  • Employers can recover 80% of compulsory commission payments and past overtime as well as 805 of wages and fees (eg membership fees). However, employers can’t recover anything for tips, discretionary bonuses, discretionary commission or to cover the cost of health insurance, a company car or any other benefits.
  • Employees can be furloughed multiple times, although each period of furlough must be for a minimum of 3 weeks.
  • If an employee has 2 jobs, they can be furloughed from each job.
  • If you are employed by your personal service company, you can be furloughed by that company – provided you don’t carry out any work for the company other than complying with your statutory duties.
  • If a director is furloughed, this must be done by Board resolution and noted in company records.
  • Claims for furlough pay must be from the date the employee is actually furloughed, not the date of the decision to furlough.

Further clarification is awaited on annual leave – we’re pretty sure that this will still accrue during furlough and we know that employees will now be able to carry over leave and take it over the next two years. We think employees can be asked to take annual leave whilst furloughed, but there is no clarity on this.

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If you have any questions on the above please speak to Caroline Banwell at Harmony HR Solutions Ltd.