Frequently Asked Questions on the Job Retention Scheme
If you recall for an employee to be placed on furlough, that employee must have been on your PAYE payroll / system on or before 28th February 2020. The reason for this cut off date is likely to prevent fraud, whereby employer could add individuals who were not intended to be employees originally in order to claim the 80% grant of usual wage costs.
Below are some FAQs about dilemma facing employers under the current Job Retention Scheme
What happens if a job offer was made or an employee was due to start after 28th February 2020?
If you had a new starter who had been made an offer by an employer to start working, they must have been put on your PAYE scheme and/or started by no later than 28th February 2020. This will impact some potential individuals where this will cut off date will have been too late for them leaving in a dilemma.
If the above applies to you, there are a number of practical considerations which you can try to implement with the employee / applicant:
- If you choose to you can start paying them from their start date (however, this will not be practicable or feasible for many SME’s for cash flow reasons);
- You can try to reach an agreement with the future employee to defer their start date so that they do not become an employee and therefore the employer will not be obligated to them;
- You can look to withdraw the offer of employment, however before doing so you must check your offer letter to check that you not offered a contract of employment, which would confer notice provisions and other contractual obligations on you as the Employer;
- Alternatively, the employee could seek agreement from their previous employers to be placed on furlough leave, although this would be up to their employer to decide and they may be unwilling to do so, especially in light of the fact that the said employee is seeking to leave them.
Can employees on maternity leave be furloughed?
The Scheme does not affect an employees entitlement to statutory maternity pay. However, where employers offer enhanced contractual maternity pay, they can furlough those employees already on maternity leave to recieve support with the usual costs of that enhanced pay.
The position above will equally apply for people on similar types of leave (such as ‘shared parental leave’).
Also employers should be cautious not to furlough a employee because they are on maternity leave, as this may mount to direct discrimination, especially as maternity is a protected characteristic under the Equality Act 2010.
If an employee is already on sick leave can they be furloughed?
The latest guidance from the Government has confirmed that an employee absent because of sickness cannot be furloughed. Any employee / worker entitled under the scheme who is either (1) self-isolating or (2) on long-term sick is only entitled to statutory sick pay or if applicable enhanced contractual sick pay.
However, nothing in the guidance prohibits an employee who is no longer off sick or in self-isolation to be then furloughed.
Can employees be put on and off furlough?
Theoretically it is possible to put individuals on and off furlough leave, provided that the employee has been placed on the three week minimum period of furlough, which is required in order to qualify for the grant.
What if an employee on furlough will be paid less than the National Living Wage / National Minimum Wage?
The Government have confirmed that in such circumstances an employee can be paid less than the NLW/NMW, provided that they still paid in accordance with the scheme.
However, any employee or worker completing training during this period of furlough must still be paid the NLW/NMW by the employer.
Can employees who are deemed ‘vulnerable’ or who are ‘shielding’ because of COVID-19 be placed on furlough?
The Government have confirmed that people who are shielding can be placed on furlough. That is to say employees who have been identified as vulnerable or at risk of severe illness from the coronavirus.
These particular employees will likely be identifiable from the contact that they will have received from the NHS advising them to stay at home at all times for at least 12-weeks.
Once again, employers are advised to speak to employees about their medical needs and conduct risk assessments to protect those deemed at risk in their workforce. Employers are also advised to check with the employee that they are agreeable to be placing on furlough as technically this could also amount to discrimination on grounds of disability.
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