Coronavirus Job Retention Scheme
The Government has announced the Coronavirus Job Retention Scheme. Under this scheme, HMRC will reimburse your business 80% of furloughed employees wages up to a maximum of £2,500 per month.
Employees must be on the payroll on 28 February 2020.
Employers may opt to continue paying employees who are not eligible for the government support at the business’s own expense.
Furloughed means that your employees are temporarily laid off but remain on your payroll and what you pay them is subsidised by the government through HMRC.
This measure is designed to help you retain your employees rather than terminating them.
The minimum period of time that an employee can be furloughed for is 3 weeks.
You will need to designate employees as furloughed and you need to inform the employees themselves. However, normal employment law is still in place and you must check their employment contract as to what you need to do to change their employment status. It might be that you need to talk with your employee to change them to being furloughed, which hopefully you would be doing anyway.
Furloughed employees must NOT be carrying out work for you.
You will also need to inform HMRC which of your employees are furloughed and make a claim for the government’s reimbursement and you will only be able to do this every 3 weeks.
The normal PAYE systems and reporting methods were obviously not set up for this situation, so further guidance will be released on how you will need to go about doing this.
Claims may be backdated to 1 March 2020
At the end of the Coronavirus Job Retention Scheme
When the Coronavirus Job Retention scheme ends, employers must decide if the employees can return to their jobs. It might be that the business is no longer viable or needs to operate on a smaller scale. If the employee(s) cannot return, then termination or redundancy may be necessary.
The Coronavirus Job Retention Scheme is not to be confused with Statutory Sick Pay.
Statutory Sick Pay
Medical evidence is not legally required for the first 7 days of sickness. Do use your discretion regarding the need for evidence for a period of sickness where your employee is advised to self-isolate.
Beyond 7 days of sickness, you may request an isolation note from your employee. This may be emailed to you.
SSP will be payable from day 1, as opposed to day 4. When the government passes the necessary legislation, it will apply retrospectively from 13 March.
SSP should be paid to eligible employees through payroll as usual. The statutory sick pay is £94.25 per week but their contractual sick pay may be more, so you should also check to their employment contract.
Employees are entitled to time off work to look after dependants. This may apply to coronavirus. There is no statutory entitlement to pay for this but some employers may offer this.
You may an employee who is in a “high risk” category, and therefore does not want to go into the workplace because they are afraid of catching coronavirus. You may be able to implement further measures in your workplace to address their concerns. However, it may not be possible or the employee still does not want to go in and although you do not have to, you may agree some holiday time or unpaid leave.
Where at all possible, it is sensible to agree a working from home arrangement.
Since things are changing on a daily, if not hourly, basis, some of the above may change, be superseded or clarified in the future.
Please double-check any of the above before acting on them.