Further Government Update on Furlough Scheme and Portal Launch Date
There is some good news for employers who are in need of help through the government furlough scheme. Representatives of HMRC have told a parliamentary select committee that the online service that will be used by employers to make a claim under the scheme will be up and running on 20th April 2020. It’s expected that the first payments will be made on 30th April 2020 and that payments will usually be processed within 4-6 working days of the claim being received.
There have been concerns that once live the service would struggle to cope with a large number of claims but HMRC have said that they have tested it to cope with a large volume of claims. A guidance document for employers on how to make claims is expected to be released to help employers with the process.
We will keep you up to date with further developments, in the meantime the government has this week published further information on the furlough scheme by again updating their guidance in some areas. Whilst additional information will be welcomed by employers, there remain some areas where further clarification is needed so it is unlikely to be the last government update.
What does the updated guidance say?
It covers a number of matters but likely to be of most interest are:
- In addition to gaining an employee’s agreement to be furloughed and any associated changes to pay, government guidance now says that ‘to be eligible for the grant employers must confirm in writing to their employee … that they have been furloughed. A record of this communication must be kept for five years’.
- The guidance now states that ‘if contractually allowed, your employees are permitted to work for another employer whilst you have placed them on furlough’. It’s possible that some employees might end up earning 80% of the old salary (or more if an employer chooses to top it up), getting a new job whilst on furlough and also earning 100% of a new salary and thereby gaining a windfall from the situation. Before placing employees on furlough, it’s advisable for employers to check their employment contracts to see what the position is in their organisation regarding other work during employment. If it is usually prohibited, employers could choose to relax the usual rules if they wished to do so.
- The guidance confirms that ‘employees can be furloughed multiple times, but each separate instance must be for a minimum period of 3 consecutive weeks’. Whilst this could be inferred from the previous guidance it is helpful to have this confirmed.
- With regard to the 80% of employee’s salary (subject to a cap of £2,500 per month) that employers can recover from the government, the guidance now says that this can include compulsory commission payments but it does not include non-monetary benefits (e.g. the value of health insurance).
The updated guidance can be accessed here
If you have an employment law matter you would like assistance with please do not hesitate to contact Kingfisher Professional Services Ltd as we are happy to help.