On 24th September the chancellor confirmed that the existing furlough scheme will close as planned on 31 October 2020 and will be replaced by the new Job Support Scheme.
From 1st July to 31 October a ‘flexible furlough’ arrangement will be allowed whereby an employee can work for, say, 2 days a week (and be paid by their employer) with the remainder of that person’s normal working week funded by the government under the Job Retention Scheme. Only those employees who have been furloughed for a minimum of three weeks prior to 30 June were eligible for the flexible furlough arrangement. The existing scheme closed to new eligible employees on 10 June 2020.
For full details on the new CJRS developments, please go to the government resource here!
A step by step guide for employers has also been released which can be accessed on the following link.
HMRC has also provided further clarification on a number of areas in its guidance for employers. There is new information added on the scheme extension, fraud, claims for employees you made redundant or who stopped working for you, fixed term contracts, agency workers and retaining records. Also, a guide has been published with information on holiday pay, employees returning from family-related statutory leave and sick pay, how to treat grant payments in Real Time Information and how to claim – see link.
Information required to claim this grant
The government have said that it is up individual businesses to calculate the amount that is to be claimed.
For entities with less than 100 furloughed staff you will need to enter the following details directly into the portal for each employee (presumably line by line):
For entities which have 100 or more furloughed staff you will be asked to upload a file with the above information into the portal. HMRC will accept .xls xlsx .csv .ods file types.
HMRC will then review your claim and if eligible pay the grant into your UK bank account by BACS
o Those on unpaid leave on 28 February 2020 cannot be included until after the date which it was agreed the individual would return from unpaid leave.
o Those on short-term sick leave, or self-isolating, should be paid SSP until they are fit to return to work. They may be furloughed from the point they can return to work.
o Those who are shielding under public health guidance or are on long term sick leave can be furloughed.
o Those unable to work due to care responsibilities arising as a result of COVID-19 can be furloughed, this includes those unable to work due to childcare commitments.
Whilst the government have confirmed that it is possible to furlough Company Directors, care should be undertaken to ensure that furloughed individuals are able to comply with the restrictions placed on the duties that can be undertaken during any furlough period. The government have issued the following guidance on this matter:
As office holders, salaried company directors are eligible to be furloughed and receive support through this scheme. Company directors owe duties to their company which are set out in the Companies Act 2006. Where a company (acting through its board of directors) considers that it is in compliance with the statutory duties of one or more of its individual salaried directors, the board can decide that such directors should be furloughed. Where one or more individual directors’ furlough is so decided by the board, this should be formally adopted as a decision of the company, noted in the company records and communicated in writing to the director(s) concerned.
Where furloughed directors need to carry out particular duties to fulfil the statutory obligations they owe to their company, they may do so provided they do no more than would reasonably be judged necessary for that purpose, i.e. they should not do work of a kind they would carry out in normal circumstances to generate commercial revenue or provides services to or on behalf of their company.
The statutory duties of a company director are set out in the Companies Act – https://companieshouse.blog.gov.uk/2019/02/21/7-duties-of-a-company-director/
Directors will need to carefully interpret whether the duties that the will be required to perform during any furlough period are compatible with the duties set out in the Companies act. Should you require any support in interpreting your individual position then please contact your usual Clive Owen contact.
Read more about the Coronavirus job retention scheme:
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