On 20^th March the Government announced the Coronavirus Job Retention Scheme. The scheme is party of a wide range of Government measures to support businesses during the Covid-19 pandemic.

Under the scheme, the Government will provide a grant to employers to by pay a proportion of employees’ salary for those who would otherwise have potentially been made redundant during this crisis.

We have answered some commonly asked questions below to assist employees in understanding the scheme.

If you have any further questions, they should be directed to your own employer.

What is the Coronavirus Job Retention Scheme?

The Government has set up the scheme to enable businesses to apply to HMRC for a grant to cover 80% of employee’s wages, up to a cap of £2,500 per month.

In order to utilise this scheme, employees must be furloughed.

What does furlough mean?

Furlough or furloughing is a new term for many of us.

It is designed to support firms during the Coronavirus pandemic, and to prevent unemployment.

It is a new status of leave and could be referred to as furlough leave.

It will temporarily help pay the wages of people who cannot do their jobs because the company is unable to operate, or have no work for employees to do because of coronavirus.

Being furloughed means employees are kept on payroll, even though they aren’t working. It has been described as a TV being placed on standby mode. Similarly to that analogy, you will be asked to remain at home, on standby, waiting for your employer to ask you to return when that period of furlough leave has ended.

In order to be furloughed, your employer will write to you and notify you of this and seek your agreement.

Can I volunteer to be furloughed?

You can volunteer to be furloughed. If you wish to be considered to be furloughed, contact your employer to let them know. Further, if you feel like you do not have sufficient work to undertake at home, let them know.

Does the scheme apply to all employees?

The scheme will apply to any furloughed employees who were on their employers PAYE payroll as of 19^th March 2020. This will include: full-time employees, part-time employees, employees on agency contracts and employees on flexible or zero-hour contracts.

Am I being laid off if I am furloughed?

No, you are still employed by the Company and will still be receiving at least 80% of your wages each month whilst you are furloughed. If someone is laid-off, that would result in receiving no pay for a short period.

What will I be paid if I am furloughed?

You will receive 80% of your regular wage up to a cap of £2,500 per month. This means that employees who usually earn more than £2,500 per month will be capped at £2,500 per month if they are furloughed. Your employer may decide to “top up” your wage by paying an additional 20% so that you will continue to receive your full pay. The decision to top up your wages will be at your employer’s discretion.

Will employee National Insurance Contributions and pension contributions have to be deducted?

The normal deductions will need to be made for income tax, employee NICs and auto-enrolment pension contributions. If pay is reduced to 80%, the deductions should reflect this change.

Will my employer have to top up my wages?

It is for employers to decide whether to top up wages (the extra 20% or anything above £2,500).

Will I still receive my fees, commission and bonuses if I am furloughed?

Non-discretionary past-overtime, fees and compulsory commission payments are included.

Tips, discretionary bonuses and commission are excluded, as are non-monetary benefits such as Benefits in Kind.

Does the scheme cover foreign nationals?

Yes, employers can furlough foreign national workers. This includes workers whose visas are subject to a condition that they have no resource to public funds.

If I am currently on sick leave or self isolating on Statutory Sick Pay, can I instead be furloughed and receive 80% of my salary?

If you are on sick leave or self-isolating in accordance with the advice issued by Public Health England, you should continue to receive SSP. You can be furloughed once you return.

What if I am a vulnerable worker who is shielding?

Workers who are shielding can be designated as furloughed but only if they cannot work from home and otherwise have been made redundant.

What happens if I become sick whilst on furlough leave?

If you become sick you must notify your employer and you will then be paid sick pay in accordance with their own policies.

Can I do any work whilst furloughed?

When on furlough, you cannot undertake work for or on behalf of the Company. This includes providing services or generating revenue.

If you are working, but on agreed reduced hours, or for reduced pay, you will not be eligible for this scheme and you will continue to be paid normally by the Company through payroll.

Whilst you cannot do any work, you are able to undertake training and do volunteer work, provided you do not provide services to or make any money for the Company.

If you are considering volunteering we suggest you tell your employer and keep them in the loop.

How long is furloughing for?

You can be furloughed for a minimum of three weeks at a time, however it is at the discretion of your Company.

If your Company proposed to furlough you, they will write to you and let you know how long the period will last. It may be that at the end of the first period of furlough, your Company will contact you to discussed extending that period.

What if I am on maternity, adoption or parental leave?

If you are eligible for Statutory Maternity Pay (SMP) or Maternity Allowance you are entitled to claim up to 39 weeks of statutory pay or allowance.

The guidance does not prohibit women on maternity leave agreeing to return to work early and then being furloughed, or electing to change to shared parental leave and then being furloughed.

What if I am currently pregnant and due to start maternity leave?

You will start maternity leave as usual.

Can I work for someone else when I am furloughed?

You potentially can, however, it would be subject to your current agreement / contract with your Company. If you are considering this, you should speak to your Company first and seek their consent to avoid any issues in the future.

What if I have already been dismissed?

Any worker whose employment was terminated after 19^th March can be rehired and furloughed. This would include those who resigned as well as those who were dismissed for a reason other than redundancy, such as misconduct.

There is no obligation on employers to re-hire a worker whose employment has been terminated.

If you would like to discuss any of the above in more detail, please contact your employer.