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Furloughing and the Coronavirus Job Retention scheme

We know how hard it’s been firstly understanding the detail of the Coronavirus Job Retention Scheme (CJRS), and then working out how to manage the process. Especially when before all of this, most people had never even used the word ‘furlough’!

In case you have to make the difficult decision of furloughing members of your team, we’ve put together some resources to help.

What is the Coronavirus Job Retention Scheme?

On 20 March 2020, the Chancellor announced the CJRS. Through the scheme, the government commits to cover 80% of the wages of ‘furloughed workers,’ up to £2,500 per month.

It’s a temporary scheme open to all UK employers until the end of October. However, from August to October, the scheme will be geared around getting people back to work with employers footing some of the bill. No details were given as to how this will work yet.

The only way to make a claim is online and it was launched on GOV.UK on 20th April 2020. Due to the volume of expected enquiries, HMRC won’t offer any telephone support. If you are making a claim yourself, here’s how you work out what you can claim. From May onwards, you’ll be able to make claims up to 14 days ahead.

 

How can I find out more ?

The government has produced a concise overview of the key points of the scheme on its gov.uk site. This is updated with the latest information and answers most questions about the operation of the scheme. If you are wanting to find out more about the employment law aspects of the scheme, espHR have a great Q+A blog answering employers’ questions. 

Key points of the scheme

How do I furlough a member of staff?

With the expert help of Samantha Wilkins at Vibrant HR, we have produced a step-by-step guide on how to furlough a member of staff. This guide shows you all you need to know – but please do get HR advice on your own situation. We have also drafted template letters to support the process of furloughing members of staff. Feel free to tailor to your requirements.

Step-by-step guide

How do I work out what I can claim?

You will need to make a claim for wage costs through this scheme.

You will receive a grant from HMRC to cover the lower of 80% of an employee’s regular wage or £2,500 per month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that subsidised wage. Fees, commission, employee benefits and bonuses should not be included.

You will need to calculate the amount you are claiming and you can submit one claim at least every 3 weeks (the minimum length an employee can be furloughed for). Claims can be backdated until the 1 March. Each business is different and some calculations can be quite complex depending on the number of your team you’re furloughing. If you need a hand, we can help.

Help me with my calculations

How does the £2,500 work?

For an employee who’s furloughed, receiving the maximum amount available from HMRC of £2,500, the cost to you as a business is £0 right now (although the £2,500 is classed as income and will affect your profit and therefore your corporation tax bill further down the line). This is how it’s broken down:

Image showing how the corona virus job scheme payout works

The net pay will be different for each of your team that you furlough depending on their own personal circumstances, so you will need to work out each team member separately. If you need a hand with this, please get in touch with us. 


Free HR helpline for Wow clients

We realised that HR advice was needed on the Coronavirus Job Retention Scheme and furloughing staff. We’ve arranged for Wow clients to be able to call and get free advice on this and any other HR queries they have. We’ve emailed all Wow clients the details on how to access the helpline. Please let us know if you haven’t received the details.


How we can help any business with the Coronavirus Job Retention Scheme

  • Calculate the amount to claim or work out how many staff you need to furlough
  • Make a claim and enter the correct information into the portal
  • Run your payroll for you through this period
  • Help you ‘unfurlough’ a member of your team
  • Introduce you to HR advisors/employment lawyers should you need to

If there’s anything else you need help with not listed above, please ask, and we’ll find a way.

Help me please

 


Key resources on the Coronavirus Job Retention Scheme:

  1. Overview of the key points of the scheme on the GOV.UK site 
  2. Work out 80% of your employees’ wages to claim on the GOV.UK site 
  3.  Q+A blog answering employers’ questions from espHR
  4. Step-by-step guide on how to furlough a member of your team
  5. Template letters to support the process of furloughing members of staff

 


Please always remember

The resources contained in our Support Hub are intended to help you and your business and are no substitute for professional HR & legal advice. Each business is different and you should get professional advice relating to your specific circumstances. If you’d like to be put in touch with someone, please let us know.

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