The Government have today provided more clarity regarding the Coronavirus Job Retention Scheme.

Who is eligible under the scheme?

Businesses can claim for the following types of employees as long as they were on the payroll on 28 February 2020:

  • Full time
  • Part time
  • Employees on agency contracts
  • Employees on flexible or zero-hour contracts

These employees CANNOT carry out any work for the employer whilst furloughed, and furlough leave needs to be for a minimum of 3 weeks to be able to apply for reimbursement.

An employee can volunteer (as long as they do not provide services or generate revenue on behalf of the employer) and can complete training courses during the period of furlough leave.

The Wage Cost to be covered

It has been confirmed that employers can claim for up to 80% of furloughed workers’ usual monthly wage cost.  This is up to a maximum of £2,500 per month and is inclusive of Employer National Insurance contributions and the minimum automatic enrolment employer pension contributions on that wage.  If the employer chooses to pay more than the minimum pension contributions, they must make up the difference.

An important point to note is that the National Minimum Wage or National Living Wage will not apply during furlough leave as the employee will not be undertaking any work.

Holiday Carry Forward

The Government have also confirmed they will put measures in place to allow workers to carry their leave over into the next two leave years.

Presently the law is that employees should take 20 days annual leave in one holiday year and these 20 days cannot be carried over.  New legislation will allow for accrued holiday out of these 20 days to be transferred into the next two years which should help smaller businesses that cannot afford to lose their staff.

Employer Furlough Information Packs now available

We now have some more clarity over how the Coronavirus Job Retention Scheme will work, although there is still a lot of practical detail to come.  To help business owners get things right our expert employment law team have prepared a pack for employers covering all the key steps involved, including how to obtain proper consent from employees to be able to furlough them and how to take them off furlough leave when the time comes.  

These packs are available now for £120 plus VAT – to find out more or to order your pack, contact us today.

The Backhouse Solicitors Team

Tel: 01245 893400
Email: [email protected]
Visit: 17 Duke Street, Chelmsford, Essex CM1 1JU

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