Coronavirus job retention scheme

Given the ongoing spread of the Coronavirus, we are providing generic guidance for members.See below for more information on the government’s job retention scheme.

We are updating this regularly in line with government advice and guidance. Last updated 07/04/2020.

Background

On Friday 20th March 2020, the Government introduced a new scheme that aims to keep people employed through the Coronavirus outbreak.

The government has announced that it intends for the Coronavirus Job Retention Scheme to run for at least three months, but they have said they will extend this if necessary. The scheme is expected to be up and running by the end of April 2020.

What does the scheme do and how does it work?

The scheme enables employers to claim 80% of staff costs if they cannot cover them themselves due to the Coronavirus. These staff costs include; monthly wages and the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions.

In order for employers to be able to access the scheme you must be officially furloughed, which means the following requirements must be met:

• You are enrolled for PAYE
• You are told that you will be kept on your employer’s payroll
• You will not be undertaking any work for your employer, which means you cannot provide services for or generate revenue for your organisation.

Furthermore, you must have been enrolled for PAYE on or before 28th February 2020, and have a UK bank account.

This furlough process allows your employer to claim a grant of up to 80% of your wage for all employment costs, up to a cap of £2,500 per month. If your employer is participating in the scheme, they are able to backdate your wages to 1st March.

During furlough you remain employed. Your wage will also remain subject to the usual income tax and other deductions.

Your employer can choose to fund the remaining 20% of your salary but they are not required to under the scheme. If your salary is reduced as a result of this, it may mean you are eligible for additional support through the welfare system such as Universal Credit. Apply here.

Employees hired after the 28th February are not covered by this scheme.

What do I need to do?

Nothing – it is your employer’s responsibility to contact HMRC through a new online portal the Government are setting up.

It is your employers responsibility to discuss any changes to your contract with you, and these changes must be made by agreement.

If you have already been laid off, your employer is able rehire you and ensure you receive 80% of your wages backdated to 1st March under the scheme. If you have been laid off, please contact your employer immediately to see if they are looking to access the scheme so you can receive at least 80% of your wages.

Do I have a choice in whether I am furloughed?

Yes, your employer must discuss with you any changes to your employment contract. If your employer wants to make changes to your contract these must be made with agreement from you. It is your right to reject changes to your employment contract. If you are concerned about any changes, or how to engage in the consultation process with your employer, please contact your union rep or the Service Centre 0800 389 6332.

Can my employer rotate my furlough status?

There is a three week minimum that an employee can be furloughed, which implies that workers can be rotated. We are seeking clarity on exactly how this enables employers to rotate workers.

Can my employer use the scheme as a form of short-time working?

The TUC says that the government has clarified that the minimum furlough period of three weeks means that workplaces can, if they are able to, run a job rotation scheme as a form of short time working, provided each worker is furloughed for that three week minimum.

Unions are pushing for further flexibilities to allow other forms of short-time work.

How will my pay be calculated?

If you are full time or part time, the Government will pay 80% of your salary before tax as of 28th February. The scheme will not include fees, commission and bonuses.

What if I am on a zero hours or low hours contract?

Even if you are on a zero or low hours contract but you currently earn more than £118 per week on average, you will be paying tax on your earnings and are on the PAYE system. This means you are eligible for the scheme.

If you have been on PAYE for an employer for a full twelve months, the employer will be able to claim for 80% of either of the higher of:

• The same month’s earnings from the previous year
• Average monthly earning from the 2019-2020 tax year

If you have been on PAYE for the employer for less than a year, they will be able to claim for 80% of an average of your monthly earnings since you started work.

Can I earn less than the National Living/National Minimum Wage through the scheme?

You are only entitled to the National Living/National Minimum Wage if you are working. Therefore, when you are furloughed you will be paid 80% of your salary even if based on your usual working hours this means you would be earning less than the National Living/Minimum Wage.

What if I am self-employed?

If you are self-employed you do not qualify for the scheme. However, on 26th March the government announced a comprehensive package for the self-employed. You can find out more about that package here.

It’s important that you notify the Department for Work and Pensions of the change in your circumstances, and tell them that it is due to the impact of the Coronavirus. As long as you meet the relevant eligibility criteria you will be able to access Universal Credit. Apply here.

What if I am on reduced hours or working for reduced pay?

This scheme is only accessible for those not working for their organisation who are furloughed. Community is working to lobby government to provide support to employers who need to reduce hours and to those employees who are receiving reduced wages as a result of this crisis.

What if I am sick?

If you are on sick leave or self-isolating you should receive Statutory Sick Pay, you can read more about that here. After this period has ended you can be furloughed. If you need to stay at home with someone who is shielding in line with public health guidance you can also be furloughed.

What if I have caring responsibilities?

If you are unable to work because you have caring responsibilities resulting from COVID19, you can be furloughed. This includes if you need to look after children who can no longer attend school.

If you are shielding in line with public health guidance you can be placed on furlough. If you need to stay at home with someone who is shielding in line with public health guidance you can also be furloughed.

No longer should any employer claim “uncertainty” or “lack of detail” for failing to take steps to protect employees’ jobs and the health of those workers and those close to them.

What if I have more than one job?

If you have more than one eligible employer, you can be furloughed by each of them and the £2,500 cap applies for each employer individually.

What if I am an apprentice?

Apprentices are eligible for the scheme. As an apprentice, when you are furloughed you can continue to train for your apprenticeship as long as this does not provide services to or generate revenue for your employer. If you are required to complete training while you are furloughed, you must be paid at least the National Living/Minimum Wage for the time spent training, even if this means you will be paid more than the subsidy of 80% of your wages for that period. In addition to this, training and assessments have been encouraged to take place remotely, and extensions should be granted, where appropriate, to the timetable for assessments.

What if I am on Maternity Leave, adoption pay, paternity pay or shared parental leave?

If you are eligible for Statutory Maternity Pay (SMP) or Maternity Allowance, then the normal rules apply and you are entitled to claim up to 39 weeks of statutory pay or allowance. Read more about SMP here.

If your organisation offers enhanced contractual pay to people on Maternity Leave, this is included in the wage costs and your employer will be able to claim this through the Job Retention Scheme. The same principles apply for contractual adoption pay, paternity pay and shared parental leave.

What employment rights do I have while I am furloughed?

You have exactly the same rights as previously including; Statutory Sick Pay entitlement, maternity and parental rights, rights against unfair dismissal and redundancy payments.

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