Coronavirus Job Retention Scheme: employer guidance FAQ
Since the chancellor announced the Coronavirus Job Retention Scheme on 20 March, employers have been keen to see the details. Yesterday, the government published its official guidance for employers. You can read it here. To help you understand who can claim and what you can claim for, we’ve prepared this short employer guidance FAQ.
1. What is the Coronavirus Job Retention Scheme (CJRS)?
CJRS is a scheme that is open to nearly all UK employers for at least three months, beginning 1 March 2020.
It allows you to claim up to 80% of your employees’ monthly wage costs, provided they are furloughed (on leave of absence). You can claim up to £2,500 per month, along with any associated Employer NI contributions and minimum auto-enrolment employer pension contributions.
You do not have to pay furloughed workers more than 80% of their regular wage (or £2,500, if that is the lower sum). If you can top up their salary you may, but this is not a legal obligation.
2. Who is the scheme open to?
The scheme is open to all UK employers that started its PAYE scheme on or before 28 February 2020.
It covers all organisations with employees, including businesses, charities and public authorities (though in many cases the latter are not expected to furlough staff – see the official guidance for details). CJRS is also open to recruitment agencies that pay agency workers via PAYE.
3. What if my business is in administration?
The administrator will be able to access the CJRS.
4. Which employees can I claim for?
You can claim for furloughed employees who were on your payroll on 28 February 2020. They can be on any contract, so this includes:
- Full-time employees
- Part-time employees
- Employees on agency contracts
- Employees on flexible or zero-hours contracts.
Please note, furloughed employees must not undertake work for or on behalf of your organisation. You must write to employees confirming they have been furloughed.
5. Can I claim for employees working reduced hours or for reduced pay?
No. They are not eligible for CJRS.
6. Do I have to furlough all my employees?
7. What about employees on sick leave or who are self-isolating?
These employees should receive Statutory Sick Pay. You may furlough them after this period.
8. How do I treat employees with more than one job?
They can be furloughed from each job. The cap applies to each employer separately.
9. Can furloughed employees do voluntary work or training?
Yes, if it doesn’t provide services or income for, or on behalf of your organisation. If they required to complete (for example) online training during furlough, they must be paid at least the National Minimum Wage / National Living Wage as appropriate.
10. What about maternity / contractual adoption / paternity / shared parental pay?
Employees eligible for Statutory Maternity Pay or Maternity Allowance are entitled to claim up to 39 weeks of statutory pay or allowance.
Those eligible for SMP qualify for 90% of earnings for the first six weeks, followed by 33 weeks of 90% of earnings or the statutory flat rate (whichever is lower).
If you pay enhanced (earnings related) contractual pay to women on maternity leave, you can claim this as wage costs through CJRS.
Note also that women must take 2 weeks off after giving birth (or 4 if they work in a factory or workshop).
The same principles apply to contractual adoption, paternity and shared parental pay.
11. How do I claim?
You need to work out wage costs, including NI and minimum pension contributions. More guidance on calculating claims for NI and auto enrolment is expected soon, before the scheme goes live. We will keep you updated.
You will be able to submit one claim every three weeks (the minimum amount of time you can furlough an employee). Claims will be able to be backdated to 1st March.
We hope this employer guidance FAQ has answered any questions you may have about the scheme. For help with making your claims, please speak to one of the THP team. We’ll be very happy to help in the light of the latest guidance.