Furlough Scheme Extended Until 2 December 2020
Amid mounting pressure over the rapid increase of coronavirus infections, on 31 October 2020, the Prime Minister announced stricter new measures will come into force across the whole of England from the morning of Thursday 5 November, lasting until at least Wednesday 2 December 2020. The precise end date is currently unclear, but the government will provide further guidance over the coming weeks.
New Measures Include
- The closure of all pubs, bars and restaurants to the public, though those able to provide takeaway service or delivery can continue to operate.
- The closure of all non-essential retail, leisure, hairdressers, gyms and entertainment venues.
- All mixing of people inside home settings to cease, although exceptions are made for childcare and other support needs.
- Travel within England to be discouraged and also between other areas of the UK.
- International Travel will be allowed for work only.
- Overnight stays away from home to be allowed only for work purposes.
- Courts, schools and universities will remain open and other sectors including manufacturing and construction are being actively encouraged to operate in line with COVID-19 secure safety guidelines.
- Those who can work from home should continue to do so.
Guidance on the new national restrictions and how this affects businesses and venues can be found on the government webpage here.
Furlough Scheme Extended Until At Least 2 December 2020
In recognition of the impact these new lockdown restrictions will have upon businesses and their employees, the Coronavirus Job Retention Scheme (Furlough Scheme) has now been extended from 31 October until at least 2 December 2020. As the Furlough Scheme was originally due to close on 31 October and replaced by the Job Support Schemes (JSS) from 1 November, to avoid having 2 schemes running simultaneously, the JSS will now be launched once the Furlough extension ends. This is good news for employers as the government contribution under the Furlough Scheme is more generous than that offered by either the JSS Open and Closed.
Furlough Scheme Reminder
The government will pay up to 80% of an eligible employee’s normal pay, capped at £2,500 and employers will be responsible for NICs and pension contributions. This follows the Furlough Scheme terms as for August 2020. Employers can choose to top up an employee’s salary to 100%, but do not have to. Full details of the scheme can be found on our webpage here.
Flexi-furlough will continue to be an option, so employees can work part-time and receive a furlough grant for unworked hours.
Under the furlough extension, eligibility has been widened with employees required to have been on an employer’s PAYE payroll before midnight on 30 October 2020. This means a Real Time Information (RTI) submission notifying payment for that employee to HMRC must have been made on or before 30 October 2020. This will benefit those employees who have never qualified for furlough, but who would have been eligible for JSS, including recent starters.
Where employees have been made redundant, it is possible for employers to agree reinstatement to assist them during this period of lockdown; their employment will once again come to an end on conclusion of lockdown. It should be noted that whilst this is an option, it is not a requirement for you to take this approach. If you are considering this option, we would advise you to contact our advice line so we can discuss any potential pitfalls.
Annual leave during furlough should be paid at 100%, so furlough pay should be topped up to 100% normal pay for any holidays taken.
If serving notice on employees to take annual leave during furlough, notice should be twice the length of the required annual leave, e.g. 2 weeks' notice to take 1 weeks' leave. It would be advisable to undertake an audit of outstanding holidays, and serve notice on those furloughed employees required to take annual leave during furlough leave.
Extended Furlough Leave Agreement Forms
To use the extended Furlough Scheme all businesses will need to have a written signed agreement with their employees. For those employees previously furloughed, you will already have an agreement in place to cover use of the extended Furlough Scheme.
However, for employees who were not previously furloughed, HR:4UK can provide our clients with extended furlough leave agreement forms and covering letters. Please contact a member of our team to receive your copies.
Many businesses may have already put in place JSS (Open) Agreements in anticipation of the scheme’s launch on Sunday 1 November 2020. If this applies to you, we urge you to contact affected employees as soon as possible to explain that the government has made a last-minute decision to extend the furlough scheme and to ask them to agree to continue on furlough instead. HR:4UK are able to provide templates for you to email (for speed) to employees to gain agreement for furlough leave.
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Disclaimer: Please note this is not legal advice on your circumstances and HR:4UK are not qualified to give medical advice. Our advice is based on our understanding of the information currently available and may be subject to change as and when more guidance becomes available.