JMR Solicitors have drawn out the main points employers need to know in respect to the Flexible Furlough Scheme and changes that occurred from 1st July 2020.
The government made an announcement that Businesses will have the flexibility to bring furloughed employees back to work part time from beginning of this month (1 July) as part of the government’s strategy to re-open the UK and jumpstart the UK economy.
In the latter part of May, the Chancellor announced changes to the Coronavirus Job Retention Scheme (furlough scheme) that would commence from 1 July 2020, giving employers more flexibility in bringing back furloughed employees on a part-time basis (the “Flexible Furlough Scheme”, which is abbreviated as FlexFS.
The government then published more information regarding the FlexFS on Friday 12 June 2020. Then, on 25 June 2020, HMRC issued its third Treasury Direction setting out the statutory provisions stipulating the FlexFS criteria.
Here is a summary of some of the key points on Flexible Furlough for employers:
- The modifications apply to any employee who has previously been furloughed for at least three successive weeks at any time during the period between 1 March and 30 June 2020.
- An employer is allowed to bring furloughed employees back to work for any set amount of time or work pattern and then claim the furlough grant for the hours that are not worked by the individual (that they would usually have done so under their contract).
- What this means is you must first calculate their employees contracted hours and the number of furloughed hours before calculating the new furlough grant for them.
- The employer is responsible for the hours the employee works for them and must pay them for those themselves.
- The number of employees you decide to claim for cannot exceed the maximum number you previously did before 30th This means, if you put 10 employees on furlough before the 30th of June, you cannot make it 20 after the 1st of July. Your maximum claim entitlement would remain as 10 employees.
- This might not be applicable if you have employees returning to work recently due to family-related leave or armed forces revisits.
- Employees may be furloughed flexibly for any time period and the three consecutive week rule doesn’t apply anymore. (until 1 July, any employee placed on furlough must have been furloughed for a minimum period of three consecutive weeks).
- Nevertheless, subject to some exceptions, the time that you claim FlexFS for must be for at least seven calendar days.
- Same as previous to 1st of June, your employees on FlexFS cannot do any work for your business when on furlough.
- Your new arrangement under FlexFS needs to be documented in writing so you must give your employee an agreement to sign.
- You must keep a copy of that agreement until at least 30 June 2025 (i.e. five years). It’s good to remember though, that HMRC guidance has recommended that you should retain a copy of all your reports in respect of furlough grant claims that you have made for each employee, for six years.
- The purpose of this new scheme is to provide employers with flexibility so this is why you can arrange more than one FlexFS agreement, change it after seven days and ask the employee to return to work, and then put them on furlough again at a later date.
- If an employee is returning from statutory parental leave such as, maternity or paternity leave, adoption leave, bereavement leave or shared parental, you can put them on the furlough scheme, even if it is the first time you are furloughing them.
- Terms and conditions apply in the case above and the employee must have been on your payroll before 19th March 2020 to be eligible. This means these employees would not contribute to the maximum number of employees you can claim furlough for in a single claim period that we mention above.
- 31 July is the final day you can submit claims for periods ending on/before 30 June 2020.
Additional alterations to the furlough grant will apply in September and October and the scheme comes to an end on 31 October 2020.
Employers can Contact JMR Solicitors for legal advice on Flexible Furlough of their employees
JMR Solicitors Employment Team can advise you legally on any FlexFS matters related to your employees. We can help you draw up new contracts for FlexFS and assist you in calculating or making your application if needed.
Contact us on 0161 491 3933 or email email@example.com