Furlough, latest guidance

[Newchodge]

Does anyone know what is the situation when you furlough staff who have a company car and private medical? Can they retain these benefits?

It depends a bit on the contract, for example is the company car dependent on them making journeys each month. If not, then yes, they continue as the employment contract is unaffected except over the requirement to attend work and receive 100% pay.

 

[Mr D]

No! - That 'Millions' knew was a 'Furlough' was!

Sorry you missed out on the education.

 

[Newchodge]

I would like to know this too, I haven't been able to find an answer yet. Universal Credit use the PAYE figures from HMRC to determine the entitlement/deductions, so if payroll is run at 100%, the employee will be entitled to less despite being paid 20% less. Conversely, if we run it at 80%, are we then only able to claim 80% OF the 80% figure.

You run payroll as normal showing the total amount you are paying the employee. Separately, and it is not yet set up, you claim the amount you have calculated as due, which may be the same as the payroll figure, or may be more, but cannot be less - you must pay everything you claim as wages to the employee. In addition you claim for the employer's NI and statutory pension payment on the same system. You can claim before an imminent payroll (so get the money in advance. You can claim every 3 weeks, but not more often.

 

[Luke P]

Hi,
I have a zero hours employee who has worked less then 12 months (started in June). She works seasonally and this would be the busy period usually. I want to help and am happy to support her separately but also want to use furlough but not sure how to apply it wage wise.
Am I meant to record a wage still for the next 3 months?
And if so since it's under 12 months and salary varies month to month is the march furlough wage the average wage from June to Feb? Is April wage then average from June to March or still Feb?
Many thanks ahead
Luke

 

[UKSBD]

Hi,
I have a zero hours employee who has worked less then 12 months (started in June). She works seasonally and this would be the busy period usually. I want to help and am happy to support her separately but also want to use furlough but not sure how to apply it wage wise.
Am I meant to record a wage still for the next 3 months?
And if so since it's under 12 months and salary varies month to month is the march furlough wage the average wage from June to Feb? Is April wage then average from June to March or still Feb?
Many thanks ahead
Luke

"If the employee has been employed (or engaged by an employment business) for a full twelve months prior to the claim, you can claim for the higher of either:

• the same month’s earning from the previous year
• average monthly earnings from the 2019-20 tax year

If the employee has been employed for less than a year, you can claim for an average of their monthly earnings since they started work."

Source: https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme

 

[Newchodge]

"If the employee has been employed (or engaged by an employment business) for a full twelve months prior to the claim, you can claim for the higher of either:

• the same month’s earning from the previous year
• average monthly earnings from the 2019-20 tax year

If the employee has been employed for less than a year, you can claim for an average of their monthly earnings since they started work."

Source: https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme

I believe, although it is not explicit, that it will be the average April to Feb, otherwise the unsrupulous could pay a huge amount in March then claim on the April to March figure.

 

[UKSBD]

I believe, although it is not explicit, that it will be the average April to Feb, otherwise the unsrupulous could pay a huge amount in March then claim on the April to March figure.

They would have to be very good friends with the employee to do that
Otherwise, what advantage is there to the employer of doing it?

 

[Luke P]

Thanks Guys,
We definitely need more clarity from the

I believe, although it is not explicit, that it will be the average April to Feb, otherwise the unsrupulous could pay a huge amount in March then claim on the April to March figure.

Thanks, that's a good point. Hope it's not from April as then the average will include 2 months before they started. Might need to check with HMRC just in case

 

[Luke P]

They would have to be very good friends with the employee to do that
Otherwise, what advantage is there to the employer of doing it?

Haha - In this case they are related

 

[Newchodge]

They would have to be very good friends with the employee to do that
Otherwise, what advantage is there to the employer of doing it?

Many people employ family members. Just saying.

More seriously, I am looking at it in terms of how fraud may be minimised. Setting the claim level at 28 February makes fraud over income levels harder, as HMRC has RTI data for that date.

I am, however, amazed at the decision to allow the self employed another 4 weeks to get their 2018/19 returns in, given they should have been filed by 31 January!

 

[Newchodge]

Thanks Guys,
We definitely need more clarity from the


Thanks, that's a good point. Hope it's not from April as then the average will include 2 months before they started. Might need to check with HMRC just in case

Sorry, if less than employment from April it would be averaged over the actual employment to end Feb.

 

[Ian J]

I am, however, amazed at the decision to allow the self employed another 4 weeks to get their 2018/19 returns in, given they should have been filed by 31 January!

Me too. There must have been some logic applied but I fail to see what it was

 

[Luke P]

Sorry, if less than employment from April it would be averaged over the actual employment to end Feb.

Perfect, that's what I was thinking and with the comment about fraud makes sense to do until Feb for each of the 3 furloughed wages

 

[UKSBD]

Me too. There must have been some logic applied but I fail to see what it was

They probably hope that they aren't too clued up about math.

Exaggerate their income thinking they will benefit, but end up paying more tax than they gain

 

[G Wilson]

Does anyone know what to advise an employee who only stated work on the 2nd March 2020. what if any assistance does the government give them.
They would be retained by the employer after the crisis. They don't have a previous employer to ask for a Forloughed as they haven't worked for 6 months prior to starting.

 

[The Soup Dragon]

Does anyone know what to advise an employee who only stated work on the 2nd March 2020. what if any assistance does the government give them.
They would be retained by the employer after the crisis. They don't have a previous employer to ask for a Forloughed as they haven't worked for 6 months prior to starting.

Nothing as far as my understanding goes!

 

[Chris-TT]

What is everyone's opinions on holiday pay incurred by the employee while furloughed? Right now employing the number of people that I do that its a concern. If it is incurred, then it will add up to many thousands per month (it works out at about 10% of your staffing costs). The way I read current employment law, we will still have to pay this. However, this is going to be an amount I can't afford if as suspected this goes on for many months.

 

[Newchodge]

Does anyone know what to advise an employee who only stated work on the 2nd March 2020. what if any assistance does the government give them.
They would be retained by the employer after the crisis. They don't have a previous employer to ask for a Forloughed as they haven't worked for 6 months prior to starting.

state benefits.

 

[Newchodge]

What is everyone's opinions on holiday pay incurred by the employee while furloughed? Right now employing the number of people that I do that its a concern. If it is incurred, then it will add up to many thousands per month (it works out at about 10% of your staffing costs). The way I read current employment law, we will still have to pay this. However, this is going to be an amount I can't afford if as suspected this goes on for many months.

During furlough the employee's contract continues and holiday continues to accrue. Acrued holiday can be taken for up to 2 years after the current holiday year.

 

[UKSBD]

Does anyone know what to advise an employee who only stated work on the 2nd March 2020. what if any assistance does the government give them.
They would be retained by the employer after the crisis. They don't have a previous employer to ask for a Forloughed as they haven't worked for 6 months prior to starting.

Advice that is better for the employee or advice that is better for the employer?

 

[paye-help]

If an employee is furloughed on 20th March and earns £2,000 per month can this be completely backdated to 1st March or will it be apportioned as 1st to 19th normal pay (£1225.81) and 20th to 31st 80% furlough pay (80% of £774.19)?

 

[Chris-TT]

During furlough the employee's contract continues and holiday continues to accrue. Acrued holiday can be taken for up to 2 years after the current holiday year.

This seems like such a silly oversight. I'm sure most employees would prefer to waver the holiday pay and receive 80% while furloughed rather than be laid off.

 

[G Wilson]

state benefits.

Do you know what benefits?

 

[G Wilson]

Advice that is better for the employee or advice that is better for the employer?

The employee. They would have been employed 35 hours a week normally and hopefully again after.

 

[G Wilson]

Nothing as far as my understanding goes!

Think there should be scaled to a slightly less % rather than State benefits

 

[UKSBD]

The employee. They would have been employed 35 hours a week normally and hopefully again after.

I would say the best advice to the employee is to just keep taking 100% of their wages until their employer offers an alternative.

 

[Mr D]

This seems like such a silly oversight. I'm sure most employees would prefer to waver the holiday pay and receive 80% while furloughed rather than be laid off.

The employees get a choice?

 

[Newchodge]

Do you know what benefits?

No, this is a business forum.

 

[Chris-TT]

The employees get a choice?

If you could give the employee a choice that would be great, however as far as I can see that currently goes against employment law. I would argue the underlining principles for holiday pay which are the health and safety need for a break do not apply, since they are already on a break.

Hopefully this has just been an oversight and it will be addressed in the coming weeks. I’m aware that as things currently stand holiday pay should accumulate. A cost a lot of companies such as mine which have had to go into full hibernation and have zero income cannot afford if this goes on for many months.

 

[Mister G]

our situation is this: we traded our cafe for 9 very quiet days from the 10th of march and basically have no money to pay the staff this week, they were existing staff that have been at the business for many years and we would like to do right by them in this troubling time but we are worried that because we started our payroll after 28th feb that we are not guaranteed to get the grant from Hmrc? we have had some advise to do a lay off £29/day payment to them but can we furlough them when the scheme is up & running? we will have to get a loan either way to pay the staff something. any informed advise/opinions are very welcome.
Thank you in advance.

 

[kevin.doran]

.

 

[Chris-TT]

our situation is this: we traded our cafe for 9 very quiet days from the 10th of march and basically have no money to pay the staff this week, they were existing staff that have been at the business for many years and we would like to do right by them in this troubling time but we are worried that because we started our payroll after 28th feb that we are not guaranteed to get the grant from Hmrc? we have had some advise to do a lay off £29/day payment to them but can we furlough them when the scheme is up & running? we will have to get a loan either way to pay the staff something. any informed advise/opinions are very welcome.
Thank you in advance.

Did you take over the business as an on-going concern, buying it as a limited company and still running it as that same limited company? If so you should be fine to furlough the employees, if you haven’t and it’s a new company then officially the staff should have been laid off from the old company and employed by the new company, if that is the case you have employed them for less than two years and can let them go without reason.
I would consult with Acas first if it’s the latter. It’s harsh on the staff, but even tougher on you if you plan to pay the wages for what could easily turn out to be 3-6 months.

 

[Mr D]

If you could give the employee a choice that would be great, however as far as I can see that currently goes against employment law. I would argue the underlining principles for holiday pay which are the health and safety need for a break do not apply, since they are already on a break.

Hopefully this has just been an oversight and it will be addressed in the coming weeks. I’m aware that as things currently stand holiday pay should accumulate. A cost a lot of companies such as mine which have had to go into full hibernation and have zero income cannot afford if this goes on for many months.

In that case don't worry about it.
Simply employees carry on accruing annual leave and can carry it forward.

Don't bet on making employees lives harder. They have enough troubles at the moment.

 

[Chris-TT]

In that case don't worry about it.
Simply employees carry on accruing annual leave and can carry it forward.

Don't bet on making employees lives harder. They have enough troubles at the moment.

We don’t want to make anyone’s lives harder, we want to have a business on the other side of this. We are currently having to pay rent and bills which are tens of thousands a month with zero income stream, there are some grants and relief, but they don’t cover everything. It’s fine if you have a couple of members of staff, when you have considerably more it quickly adds up to this ever growing mountain of debit. It will be the difference for a lot of company’s with 50+ employees of being able to furlough employees or not.

Currently everyone is furloughed and I really want to keep it that way for there sake. so I hope new legislation comes in over the coming weeks.

 

[Mr D]

We don’t want to make anyone’s lives harder, we want to have a business on the other side of this. We are currently having to pay rent and bills which are tens of thousands a month with zero income stream, there are some grants and relief, but they don’t cover everything. It’s fine if you have a couple of members of staff, when you have considerably more it quickly adds up to this ever growing mountain of debit. It will be the difference for a lot of company’s with 50+ employees of being able to furlough employees or not.

Currently everyone is furloughed and I really want to keep it that way for there sake. so I hope new legislation comes in over the coming weeks.

Don't bet on more help from government. They may extend existing help. They may come up with some more stuff for the public.

Just don't bet your business on more help for businesses.
May happen, may not - likely not be what 100% want anyway.

 

[Newchodge]

Did you take over the business as an on-going concern, buying it as a limited company and still running it as that same limited company? If so you should be fine to furlough the employees, if you haven’t and it’s a new company then officially the staff should have been laid off from the old company and employed by the new company, if that is the case you have employed them for less than two years and can let them go without reason.
I would consult with Acas first if it’s the latter. It’s harsh on the staff, but even tougher on you if you plan to pay the wages for what could easily turn out to be 3-6 months.

I am sorry but this is not accurate

 

[Chris-TT]

I am sorry but this is not accurate

Care to elaborate?

 

[Newchodge]

Care to elaborate?

Every word is garbage. Is that better?

 

[Mr D]

Care to elaborate?

Think you missed TUPE.

 

[Chris-TT]

Every word is garbage. Is that better?

If you’re not willing to elaborate then are just here to pedal your services, otherwise you would be happy to explain. I’ve purchased several companies, and this is how it’s worked. Perhaps I’m getting some instances mixed up with buying through administration. So please go ahead any explain how the process works for this person and advise on what I said wrong.