You may be considering furloughing your staff due to the current coronavirus pandemic, I am providing information to you in relation to this. In addition, I have attached a template letter which has been prepared by Make UK. As each of your circumstances may be different this can be used and tailored to suit. There are several options within the letter. Please ensure you read it properly and choose the most appropriate circumstances for your employees.
This is a change to your employees terms and conditions and you should have them sign to agree this or e-mail so that you have a copy of this agreement for your records. Your contract of employment may have provisions for furlough or temporary lay-off of staff.
If you require us to deal with the furlough procedure with HMRC, please can you provide us with a copy of the letter that you have sent to your employees so we understand the terms on which you have furloughed your staff. We may also need to attach a copy of this with any claims to HMRC. As the systems are still not up and running yet there may be further information required and we will let you know in due course.
A summary of information regarding furlough is shown below, this has come from Hempsons Health and Social Care lawyers and I have also attached the full guidance for your information below:
- public sector employers (where wages are still being funded by government) are not expected to use it
- publicly funded yet not public sector employers are also not expected to use it
- employees including zero hours employees can be claimed for
- no work can be undertaken except training
- employees need to be on payroll on or by 28 Feb 2020 for it to apply
- employees on sick or self isolating cannot be furloughed until after their isolation
- furloughed employees are allowed to volunteer although they cannot volunteer for the organisation that has furloughed them
- if a furloughed employee is training, they should be paid at least NMW/NLW even if that takes them above the 80%
- Statutory Maternity Pay (and related paternity/adoption pay) operates as normal
- contractual maternity payments made in addition to SMP is eligible to be claimed by employers under this scheme
- employers can claim 80% or £2500 (whichever is lower) plus NICs and statutory minimum pension contributions
- for staff with variable pay, use the previous month the previous year or annual average
- furlough should apply in 3 week blocks
- there is nothing to stop employees being furloughed on rotation
- wages of furloughed employees are subject to usual tax and NI
You can download the template letter below:
Guidance for Employers:
Guidance for employees:
I hope you all find this helpful and I will continue to provide new information as this becomes available. If you need any help in relation to this or any other difficulties you are having at this time please do not hesitate to contact me on email@example.com.
Sian Broughton ACMA, CGMA, DChA, MAAT, ASET
Chief Executive Officer – East Riding Voluntary Action Services (ERVAS) Ltd
and Director – Phoenix Accountancy and Business Consultancy Limited