EMPLOYER GUIDANCE: FURLOUGHED WORKER RULES
The Government has now released updated information regarding the Coronavirus Job Retention Scheme. This outlines the Furloughed Worker rules and processes to claim the grant, which will help financially support businesses through these uncertain times. This scheme will help businesses pay employees 80% of their salary, up to £2500 a month, provided they were on their payroll on or before 28th February 2020.
To make it easier for our recruitment community to fully understand the rules of this scheme, TBOS have summarised the Furloughed Worker rules in this article.
WHICH BUSINESSES ARE ELIGIBLE FOR THE SCHEME?
Any UK business, including recruitment agencies, can claim this funding provided they:
- Created and started a PAYE payroll scheme on or before 28th February 2020
- Enrolled for PAYE online
- Hold a UK bank account
WHICH EMPLOYEES ARE ELIGIBLE FOR THIS SCHEME?
You are able to claim for any employees who are on any type of employment contract, this includes full-time, part-time, flexible and zero-hour contracts, provided they have been on your payroll on or before 28th February 2020.
Employees hired after this time are exempt from this scheme.
ARE RECRUITMENT DIRECTORS ELIGIBLE FOR THE FURLOUGHED WORKER SCHEME?
The new update now states that all recruitment directors can apply for the furloughed worker scheme. It notes…
‘Where furloughed directors need to carry out particular duties to fulfil the statutory obligations they owe to their company, they may do so provided they do no more than would reasonably be judged necessary for that purpose, for instance, they should not do work of a kind they would carry out in normal circumstances to generate commercial revenue or provides services to or on behalf of their company.’
If your recruitment agency has more than one director, it is at the discretion of the company which recruitment directors can be furloughed at any given time. These directors must be told in writing if they are to be furloughed. As noted in their update these furloughed directors must not generate money or provide services to the business during their furloughed leave.
THE FURLOUGHED WORKER RULES
Furloughed workers must not undertake any work for the business, this means:
- They must not generate money for the business
- They must not provide services for the business
When employees are placed as Furloughed Workers they must do so at three weeks minimum each time, however, there is no limit on the number of times an employee can be furloughed.
Furloughed Workers can take part in volunteer work or training during their Furloughed leave.
HOW MUCH CAN YOU CLAIM?
Businesses can claim 80% of employees’ wages, even employees on National Minimum Wage, up to a maximum of £2500 per month. You can choose to top up your employees’ salary but you are not required to.
Claims will be back-dated to the 1st March 2020. All claims should be started from the date that the employee finishes work and starts furlough, not when the decision is made, or when they written to confirming their furloughed status.
Although this is a temporary scheme the Government has enforced for 3 months (starting 1st March 2020), it may be extended if necessary.
STAY UPDATED WITH TBOS
TBOS will continue to provide regular updates during the outbreak to ensure our recruitment community stay well informed of their employer obligations. We are also analysing our data across our many recruiting clients in order to produce industry insights and trends across the industry at this time.
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