In the on-going war on COVID and subsequent Lockdown 2.0, the Government recently announced a return to the Flexible Furlough Scheme (officially, the Coronavirus Jobs Retention Scheme) rather than pressing ahead with the Job Support Scheme.
It’s been a lot for employers to get their heads around. First, the Flexible Furlough Scheme (FFS - yes, really!) was phased out with an end date of October 31st at which point the Job Support Scheme (JSS) was due to take over. After much outcry over some of the detail, the JSS was amended again – see our previous article for the full explanation on that. We’d all just about got our heads around those changes when the Government announced Lockdown 2, then scrapped the JSS and declared a return to the Flexible Furlough Scheme, but not the way it looked at the end of October.
Confused? You’re not alone! It was the main topic of discussion when I hosted our Weekly Employer’s Conference Call on Wednesday: lots of employers with lots to say and a lot of questions! Here, I’m going to weed through some of the detail of the new version of the FFS and, hopefully, shed some light on the situation.
This version of FFS (I’m enjoying that acronym a little too much these days) starts from the 1st November and is being extended until the 31st March 2021. This scheme is designed to help employees whose place of work has either had to close or the amount of work they’re required to do has been reduced as a result of COVID-19 restrictions.
By the end of the FFS, the Government was covering 60% of the furlough wages and businesses were topping up the wages to 80% (capped at £2,500 per month), as well as covering National Insurance Contributions and Pension contributions. The new November version of the FFS means the Government will contribute 80% of the wages and employers will only need to cover pension and NIC. This is more generous than the JSS which required employees to be working a minimum of 20% of their normal hours to be eligible for the scheme. Payment for the portion of the unworked hours for JSS was divided three ways: 5% by the employer, 61.67% by the government and the remaining cost was to be absorbed by the employee unless the employee elected (and was able to) top it up.
With the November version of the FFS, just as it was back in August, staff can work part-time and be on part-time furlough provided they were on the payroll by the 30th of October. This goes no matter the type of contract: full-time, part-time, agency, flexible or zero-hour are all eligible. There is no requirement for employees to have been previously furloughed. Whilst on furlough, they will still be free to take up work for other employers as long as their current contract allows for it.
One of the immediately obvious questions that hit us when the extension to furlough was announced, was, ‘So, what happens to those employees who were given redundancy notices for their employment to cease as of the end of October?’ The answer is, so long as they were employed and still on the payroll on the 23rd September can be re-employed and their furlough pay can be claimed for by their companies.
This news will come as an immense relief to many employers, employees and their families, especially given we’re in the lead up to Christmas.
The scheme applies throughout the UK. Take note: the JSS was to be paid initially by the employer and the monies reimbursed subsequently. Given the scheme was announced on the day the FFS was supposed to end, the Government requires some time to update their systems. As a result, initially, employers will need to pay the wages and then submit their claim to the government for reimbursement. Once the systems have been updated, businesses will be paid in advance.
No doubt, we’ll see further changes as the government and the business community as a whole continue to adapt and evolve as we deal with the fallout of the pandemic. If anyone has any questions, I’m happy to have a chat. Alternatively, why not join us each Wednesday at 11 am for an hour as I host the Employer’s Weekly Conference Call. Air your views, share your experiences, ask questions and find solutions to the various challenges we’re all facing. Email us at [email protected] for your link.
Stay safe everyone.
~ Jason Perry, Managing Director, ASL Recruitment
ASL Recruitment was established in 1999 and has been serving Hastings and the surrounding area ever since placing temporary and permanent roles across a variety of sectors including Industrial and Manufacturing, Legal, Finance, Marketing, Technology and Office Support, from junior up to board level. Our co-founder and Managing Director, Jason Perry is a HR specialist and a Chartered Fellow of the Chartered Institute of Personnel and Development. For further information on our recruitment or consultancy services, email [email protected] or call us on 01424 452999.
