What happens after Furlough ends and The Job Support Scheme Starts? and what does it mean for you?
What exactly is taking place?
With furlough now coming to an end you may have Employees who will have been on Furlough leave, some of them since March this year. In any event as the Furlough Scheme winds down and ends on 31 October 2020 you will by now be making plans to bring Employees back to work.
The government advice has at times perhaps been conflicting and difficult to decipher, it has at times been back to work and then stay at home, we are now back to the message ‘those who can work from home must do so’. We advise that home working is the best option where there is the capacity to do so and the Employees role allows for this and where it is not possible then your Employee should then return to a workplace that is COVID secure, adhering to the most up to date guidance.
We look at the implications of the return process; we offer handy advice and links to help you in this process.
Today we look at the end of furlough, Employees who are returning and how to plan for this and also the new JSS The Job Support Scheme which replaces Furlough.
It contains information from trusted sources (Gov.uk) and links to the site, we have other topics in our Covid-19 Toolkit which may also be of relevance to you including further reading on risk assessments, flexible and home working, returning to work and payments.
How should you communicate with your Employees who are returning?
Communication will play an important part in the return to work process and we would suggest you speak to your Employees as soon as possible, this will help them to understand what is happening, you can ask them how they are feeling, answer any questions involve them and plan for their return.
All Employees that have been placed on Furlough should have been communicated with and in writing (an Agreement) this was to place them on Furloughed leave in the first instance and gain their consent to becoming a Furloughed Employee. It is important that as an Employer you keep records of these Agreements for 5 years for HMRC purposes.
Once you intend to bring back your Employee you must now end this Agreement and you would communicate this in writing to them, stating the date of return and that their salary will revert.
From 1 July 2020 Employers have the option to utilise a flexible approach and you may want to consider a phased return, with this you may want to introduce flexible working and or home working these measures will allow for Social Distancing in your workplace.
We should never underestimate how our people are feeling, whilst they may have been out of sight they will be frightened, Mental Health issues have been cited recently as being an increased risk to individuals, your reassurance will be the best possible communication of all.
You can provide your Employees assistance by supporting them and signposting them, we have added a handy link for you, from this you can download a document direct from Gov.uk to provide to your Employee.
Employers should be mindful of the needs of different groups of workers or individuals. It is breaking the law to discriminate, directly or indirectly, against anyone because of a protected characteristic such as age, sex or disability, race or ethnicity. Employers also have responsibilities towards disabled workers and those who are new or expectant mothers.
How can you plan for the return?
You can ensure you follow the guidelines set out by the Government; they will include details for individuals returning from Furloughed leave.
Ensure you implement the measures that are needed to protect your Employees, ensure you implement the measures that are needed to protect your Employees.
It is important that Social Distancing measures are met and that any physical adjustments are met for your Employees; considerations will need to be factored in and any reasonable adjustments made where relevant.
Eliminating risks will be a key element and by now Managers and business owners should be implementing the risk assessments as part of their routine.
Whilst hygiene may sound simple especially hand washing this is cited as being the most important method to reduce the spread of infection, we have added a link for a reminder.
If any of your team have or show any symptoms you can check them here: https://www.nhs.uk/conditions/coronavirus-covid-19/symptoms/
What happens when your Employees do return?
It will be important for your Employees returning from Furloughed leave to have a return to work completed, this will ensure you have discussed any concerns they have about the workplace and their Health and Safety.
You should conduct an induction for your Employees who are returning this may be to familiarise them with new ways of working, Social Distancing measures, hygiene routines, break times, access points and who to speak to if they are feeling unwell in the future or if they have any concerns.
In addition to this you should have QR codes in place and this should be explained to anyone returning from Furlough leave, you should also advise your Employees about the risks of them becoming ill, at risk or in contact with others, you must advise them of the consequences not just the financial implications of this (fines) personally but you have a duty of care towards others as an Employers and are liable to fines ranging from £1,000 up to £10,000 for failing to allow your Employees to self-isolate.
It is important to share with them your COVID Risk Assessment, this will provide them not only with the necessary guidance but also reassurance they need that you have taken action and that provisions are in place to protect them.
Clarify holiday entitlement with them, they will have accrued holiday entitlement during their time away and at this stage you may wish to plan periods of leave where capacity allows or let them know what your new booking process is if you have amended this and finally where you have amended the right to carry leave over you should let them know.
This should be reviewed on a weekly basis to allow them to settle into the workplace, you perhaps will not return certain individuals full time initially and we would recommend this, well over 4 months away from work is a long time so a phased approach would be a better option; you would gauge this from your initial conversations and individual circumstances.
What can you do if your Employee refuses to return?
Where you have implemented all of the above measures, your workplace is a Covid-Secure Environment, you have completed your risk assessments and made any reasonable adjustments where necessary to facilitate a safe return, you could if you chose to:
- Offer unpaid leave
- Offer annual leave
- If the individual has been furloughed for a full 3-week period prior to 30 June, you may be able to apply for the Coronavirus Job Retention Scheme, under which they can be furloughed and receive 80% of their regular wages, up to a cap of £2,500. This scheme will run until 31 October 2020.
- Statutory Sick Pay is available as a safety net in cases where the individual is unable to work or to be furloughed under the Coronavirus Job Retention Scheme (exclusions apply).
- Please remember If an individual is no longer shielding, they will no longer be eligible for SSP after 31 July.
- Where no other options apply the matter could be deemed as unauthorised absence
It is worth noting that the Working Time Regulations 1998 (WTR), as an Employer you must give notice of at least the total length of the leave period before the date upon which the holiday is due to start. In effect this means doubling up the period of time or as an example, refusing a five-day holiday would require notice at least five working days before the holiday starts.
Let us take a look at what is next?
What happens after Furlough ends?
As one scheme ends another one begins and so we see the start of The Job Support Scheme (JSS), in an attempt to save viable jobs this is the Government’s plan for the coming months.
What is it?
The Job Support Scheme (JSS) is designed to protect viable jobs in businesses who are facing lower demand over the winter months due to Covid-19, to help keep their Employees in employment.
As an Employer you will continue to pay the Employee for time worked, but the burden of hours not worked will be split between the Employer and the Government (through wage support) and the Employee (through a wage reduction), and the Employee will keep their job.
The Government will pay a third of hours not worked up to a cap, with the Employer also contributing a third. This will ensure Employees earn a minimum of 77% of their normal wages, where the Government contribution has not been capped.
Employers using the Job Support Scheme will also be able to claim the Job Retention Bonus if they meet the eligibility criteria. The scheme will open on 1 November 2020 and run for 6 months, until April 2021.
Who is eligible?
All Employers with a UK bank account and UK PAYE schemes can claim the grant. Neither the Employer nor the Employee needs to have previously used the Coronavirus Job Retention Scheme.
Large businesses will have to meet a financial assessment test, so the scheme is only available to those whose turnover is lower now than before experiencing difficulties from Covid-19. There will be no financial assessment test for small and medium enterprises (SMEs).
Employees must be on an Employer’s PAYE payroll on or before 23 September 2020. This means a Real Time Information (RTI) submission notifying payment to that Employee to HMRC must have been made on or before 23 September 2020.
To support viable jobs, for the first three months of the scheme the Employee must work at least 33% of their usual hours. After 3 months, the Government will consider whether to increase this minimum hour’s threshold.
Employees will be able to cycle on and off the scheme and do not have to be working the same pattern each month, but each short time working arrangement must cover a minimum period of seven days.
What if you are subject to a forced to close due to a local or national lockdown?
You will be able to claim a grant to cover your employees’ wages whilst you are subject to legal restrictions.
It does not matter whether the restrictions are local or national, and they can be imposed by the UK Parliament, the Welsh or NI Assembly, or Scottish Parliament.
We are checking what happens if a business is partially hit by restrictions, and if all larger firms are eligible, some are not for the rest of the Job Support Scheme.
Where you are forced to close you will be able to claim for two-thirds of each Employee’s salary, up to £2.1k per month, in this instance you will not have to pay anything towards your Employee’s wages, although you can choose to top up wages if you wish. The grant will not cover Class 1 Employer NICs or pension contributions, although these contributions will remain payable by you as the Employer.
What does the grant cover?
For every hour not worked by the Employee, both the Government and Employer will pay a third each of the usual hourly wage for that Employee.
The Government contribution will be capped at £697.92 a month. Grant payments will be made in arrears, reimbursing the Employer for the Government’s contribution.
The grant will not cover Class 1 Employer NICs or pension contributions, although these contributions will remain payable by the Employer. “Usual wages”.
Employees who have previously been furloughed, will have their underlying usual pay and/or hours used to calculate usual wages, not the amount they were paid whilst on furlough.
Employers must pay Employees their contracted wages for hours worked, and the Government and Employer contributions for hours not worked.
The expectation is that Employers cannot top up their Employees’ wages above the two-thirds contribution to hours not worked at their own expense.
What does it mean to be on reduced hours?
The Employee must be working at least 33% of their usual hours. For the time worked, Employees must be paid their normal contracted wage.
For time not worked, the Employee will be paid up to two-thirds of their usual wage.
Employees cannot be made redundant or put on notice of redundancy during the period within which their Employer is claiming the grant for that Employee.
How can you claim?
The scheme will be open from 1 November 2020 to the end of April 2021. Employers will be able to make a claim online through Gov.uk from December 2020. Payments will be paid on a monthly basis.
Grants will be payable in arrears meaning that a claim can only be submitted in respect of a given pay period, after payment to the Employee has been made and that payment has been reported to HMRC via an RTI return.
Will there be any HMRC checks?
HMRC will check claims.
Payments may be withheld or need to be paid back if a claim is found to be fraudulent or based on incorrect information. Grants can only be used as reimbursement for wage costs actually incurred.
Do you need your Employee consent?
Employers must agree the new short-time working arrangements with Employees, make any changes to the employment contract by agreement, and notify the Employee in writing and gain consent.
This agreement must be made available to HMRC on request.
The intention is that Employees will be informed by HMRC directly of full details of the claim.
Beth normally works 5 days a week and earns £350 a week.
Her company is suffering reduced sales due to coronavirus. Rather than making Beth redundant, the company puts Beth on the Job Support Scheme, working 2 days a week (40% of her usual hours).
Her Employer pays Beth £140 for the days she works.
And for the time she is not working (3 days or 60%, worth £210), she will also earn 2/3, or £140, bringing her total earnings to £280, 80% of her normal wage.
The Government will give a grant worth £70 (1/3 of hours not worked, equivalent to 20% of her normal wages) to Beth’s Employer to support them in keeping Beth’s job.
The table shows below the contributions:
|Hours Employee Worked||33%||40%||50%||60%||70%|
|Hours not Employee Worked||67%||60%||50%||40%||30%|
|Employee Earnings (% of normal Wages)||78%||80%||83%||87%||90%|
|Govt Grant (% of normal Wages)||22%||20%||17%||13%||10%|
|Employer Cost (% normal wages)||55%||60%||67%||73%||80%|
If you need any help or assistance we are ready to help you, get in touch to have a discussion with one of our team, you can call us on 01254 467156 for an informal chat, you can also email us @ [email protected]