With the ever changing rules around furlough, it is imperative that employers have the right information if they have, or intend to, use the Coronavirus Job Retention Scheme (CJRS), otherwise referred to as the Government’s furlough scheme.
In brief, the CJRS/furlough scheme is a Government grant to employers that have staff which are unable to work within their business due to reasons related to the COVID pandemic.
In this article we answer the 7 most common questions that we are currently being asked by our clients in relation to the CJRS –
Q1) Are many employers still using furlough?
As at 30 April 2021, around 35% of employers had staff on furlough, amounting to 3.4 million employees. Whilst the use of furlough remains common, there is a downward trend following the Government increasing the level of contributions by employers towards the cost of this scheme.
Q2) Can a business still furlough staff?
Subject to the rule of the CJRS, employee can still be given a Furlough Agreement for full-time or flexible furlough (see Question 5), however when claiming the CJRS grant for furloughed hours, employers need to report and claim for a minimum period of seven consecutive calendar days;
Q3) When is the furlough scheme due to end?
Subject to any further announcements from the Government, CJRS is due to end on 30 September 2021;
Q4) What is the contribution that an employer has to make towards furlough pay?
Whilst employees will still receive up to £2,500 (monthly cap) in Furlough Pay, the balance of Employer and Government contributions to the scheme is changing –
– July 2021: Government 70%, up to £2,187.50, Employer 10% up to £312.50;
– August & September 2021: Government 60%, up to £1,875, Employer 20% up to £625.00.
Q5) Can staff be partially furloughed and if so, how do you calculate the CJRS grant in relation to those employees?
Furloughed staff can work on a part-time basis and the monthly caps on the grants that an employer can claim under the CJRS are proportionate to the hours not worked by an employee;
Q6) Can an employer change an employee from full –time to part-time furlough?
Employers can vary the furloughed hours under the terms of a Furlough Agreement or with an employee’s consent;
Q7) How do you work out national insurance contributions and pension entitlement for part-furloughed staff?
For flexible furloughed staff, employers are required to pay the following:
– Hours worked – The employee’s salary, employer National Insurance Contribution (NIC)s and pension contributions;
– Hours not worked (furloughed) – The employer NICs and employer pension contributions due on an employee’s furlough pay in respect of the.
Whilst many employees have been on long term furlough or flexible furlough, the businesses in which they worked in before the pandemic have had to adapt to survive. As a result employees may not have their pre-pandemic jobs to return to and with the CJRS coming to an end, some employers are now considering re-structuring their business or making redundancies.
Should you require support and advice in relation to furloughed employees, re-structuring your business or redundancies, please do not hesitate to contact us – https://www.isonharrison.co.uk/contact/.
For cost effective, insurance backed, employment law and HR support for your business, Ison Harrison’s new In-House: Employment Law and HR service is ideal to protect your business and help it adapt to the ‘New Normal’.