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12th June 2020: The Latest CJRS Flexible Furlough Update

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On Friday 12th June 2020, the Government announced further guidance for employers regarding the flexible furlough scheme. This follows our earlier update on essential advice for employers regarding flexible furlough eligibility and preparation.

The Story So Far

In a speech given on the 29th May chancellor Rishi Sunak announced some significant changes to the furlough scheme for employers and employees. This included outlining the plans for tapering the furlough scheme. This means that from the 1st July 2020, employers will be able to furlough employees on a flexible basis to allow them to decide on the safest and most suitable arrangements to re-onboard workers and begin to kickstart the economy once again.

In a further update delivered on the 12th June 2020, the government guidance for the Coronavirus Job Retention Scheme (CJRS) was updated on the 12th June and explains that:

“From 1 July, employers can bring furloughed employees back to work for any amount of time and any work pattern, while still being able to claim the grant for the hours not worked. From this date, only employees that you have successfully claimed a previous grant for will be eligible for more grants under the scheme. This means they must have previously been furloughed for at least 3 consecutive weeks taking place any time between 1 March and 30 June 2020. For the minimum 3 consecutive week period to be completed by 30 June, the last day an employee could have started furlough for the first time was 10 June. This may differ if you have an employee returning from statutory parental leave.

From 1 August 2020, you will be asked to contribute towards the cost of your furloughed employees’ wages.”

Mitrefinch breaks this down in the essential points for employers to consider now:

Eligibility: Who Can Claim?

The latest government guidance states that you can claim for “any employees you have furloughed” if you meet the following criteria;

  • Furloughed that employee for at least 3 consecutive weeks between the 1st March and the 30th June 2020
  • A UK PAYE scheme started on, or before, the 19th March 2020
  • Enrolled for PAYE online
  • Submitted a report under the Real Time Information (RTI) reporting system for that employee on or before 19 March 2020
  • A UK bank account

This means that if you have not had an employee on furlough before the 10th June 2020 you will be unable to flexibly furlough that employee under the new scheme. There are exceptions to this rule for employees who are currently on statutory maternity or paternity leave, shared parental leave, or parental bereavement leave. You can learn more about the exceptions here. Please note that further updates to this are yet to be announced or published.

Claims: Deadlines for Your Calendar

10th June: The last day on which someone who has never been furloughed before can start a period of furlough and qualify for the scheme

The 10th of June 2020 is the last day that you could have furloughed a previously non furloughed employee to qualify for the scheme from the 1st July 2020. Unfortunately, if you have missed this deadline, the employee you wish to flexibly furlough will not be able to complete the required full three consecutive weeks ahead of the launch of the new scheme.

30th June: The closing day of the previous furlough scheme

The 30th June marks the closing date of the furlough scheme as we have known it to date. This means you will only be able to claim for employees after that if they have been furloughed for a full three-week period at any time before the end of June.

1st July: The date you have the flexibility to bring back previously furloughed employees part-time.

From the 1st July 2020 employers will be able to bring back previously furlough employees on a part-time basis. You can choose the shift patterns and hours that suit the needs of your employees, and your business. Employers will pay wages for the time the employees are working for, and the CJRS will cover any of the normal hours they are still furloughed for.

31st July: The last day you can submit claims for furlough periods ending on or before the 30th June.

The 31st of July 2020 is the last day that you can submit claims for periods ending on or before 30 June. This means that the last day employers can claim furlough payments for any period of furlough on or before the 30th June will be the 31st July. Do not miss the deadline or you will not be able to claim your entitlement.

This is the case even when you intend to keep an employee on full-time furlough in June furloughed in July. Separate claims will need to be submitted to cover the days in June and the days in July. This may mean that your claim periods will differ from the pay periods you use. This also applies to both employees furloughed for the first time and those you have previously furloughed and claimed for.

Follow the government’s guidelines on how to submit claims here.

1st August: The date that employers will begin to contribute towards wage costs of furloughed employees

From 1st August, employers will be asked to pay a modest contribution towards their furloughed workers’ wages. The contribution will begin at just 5% of the total employment costs covering national insurance and pension contributions whilst the taxpayer contribution remains at 80%. In September, as changes to workplaces and business practices are rolled out, the amount employers will be contributing will rise to 10% whilst the taxpayer contribution drops to 70%. Finally, by October the government will pay 60% and employers will pay 20% and at the end of October, the scheme will officially end.

Next Steps: Actions Employers Need to Take Now

If you wish to make use of the CJRS from the 1st July 2020, you should look to get formal agreements in place, and in writing, with your employees as soon as possible. The government has provided robust guidance surrounding the steps to take before calculating your claim which you can access here

Prepare for Formal Time-Tracking and Hours Reports Now

In order for the new flexible furlough scheme to work, employers are required to formally track and report accurate employee working hours. Without this, you will not be able to recover and claim your employees wages through the CJRS. HMRC also reserves the rights to retrospectively audit all aspects of your claim

The methodology for calculating the “usual hours” of furloughed employees returning to work part-time is complex. Employers should understand the detailed requirements, and that their process and systems are ready for the new scheme. Guidance on how to calculate this can be found here but the onus is on employers to track and report on their employees hours. If you aren’t already using a robust time and attendance system, then now is the time to invest. Implementing an intelligent technology platform now will make the next five months much less of a burden on your administrative staff and ensure that you are fully eligible for all of the support that you have access to. 

Time and attendance software will play a critical role in the accuracy of your workforces’ records and compliance with the government requirements which make you and your business a candidate for financial support. Our time and attendance software is designed to reduce the burden of remote and flexible workforce management. Over forty years we have refined, optimised, and streamlined our software to make it the best in the market no matter whether you’re managing a team of 50, or 500. It is one of the most powerful pieces of software on the market and will help you ensure that you are not risking your eligibility for financial support due to inaccurate, or poorly maintained, employee attendance records.

Despite its heavyweight capabilities, our time and attendance systems and software can be up and running in as little as just two weeks; minimising the risk of costly errors as we move in the new flexible furlough scheme.

Contact us today to book a free consultation with one of our business advisors to discuss your needs and arrange a free virtual demo now.

If you are concerned about managing your workforce during this time, we can help assess your current workforce management solutions and can even get time and attendance systems up and running in under two weeks. Talk to a member of our team about your unique challenges today to understand how we might be able to help you. 

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Mitrefinch needs the contact information you provide to us to contact you about our products and services. You may unsubscribe from these communications at any time. For information on how to unsubscribe, as well as our privacy practices and commitment to protecting your privacy, please review our Privacy Policy.

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Mitrefinch needs the contact information you provide to us to contact you about our products and services. You may unsubscribe from these communications at any time. For information on how to unsubscribe, as well as our privacy practices and commitment to protecting your privacy, please review our Privacy Policy.

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