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Coronavirus: Furlough Leave – Updated Government Guidance

The HMRC online portal is now open for applications from businesses looking to claim 80% of the wages of their furloughed employees. Government guidance for employers and employees continues to be updated and our Employment team provides a rundown of three key points.

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Published 23 April 2020

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The HMRC online portal is now open for applications from businesses to claim 80% of the wages of furloughed employees up to £2,500 per month per employee.

More than 140,000 businesses applied using the portal for over 1.3 million employees on the first day alone. The portal can be accessed here.

Government guidance for employers and employees has continued to be updated since the portal went live on 20 April 2020, and we provide a rundown of three key points here.

Annual Leave

The updated guidance has confirmed that employees are free to take both bank holidays and annual leave whilst they are furloughed.

In the absence of a contractual agreement otherwise employers will need to pay the holidays of furloughed staff at their pre-furlough remuneration. This is likely to take the form of a ‘top-up’ from the government contribution to the pre-furlough contractual salary.

Statutory Sick Pay

The guidance states that the Coronavirus Job Retention Scheme (the Scheme) is not intended for short-term absences of employees as there is a three-week minimum period during which employees must be furloughed. Therefore, employers should not consider short-term illness or self-isolation as reason in itself to furlough. However, if employers wish to furlough employees who are not required in the business and those employees happen to be off sick that does not preclude them being furloughed.

Employers are also able to furlough workers who are on long-term sick leave. If this is done, employers will be able to claim under the Scheme for the period when the employee is furloughed and from the SSP rebate scheme for the period when they are on sick leave. However, these must be independent claims and an employee can only benefit from one regime at a time.

Should an employee who is not furloughed become ill or need to self-isolate then employers may apply for the SSP rebate scheme and make a claim for two weeks of SSP per employee.

Delayed Furlough Grant

The guidance has confirmed that employers do not have the unilateral right to delay paying wages pending receipt of the Government’s grant covering 80% of salaries up to £2,500.

Any agreement to delay wages, for example pending receipt of the furlough monies from HMRC, must be accepted in writing by the employee either as part of the furlough agreement or otherwise.

The Government has announced that the grant should be paid within six working days of a successful application being lodged with the HMRC portal and so it may be possible for businesses to apply in a timely manner and receive the grant in time for the April payroll.

If you have any queries about your specific circumstances, our specialist Employment team are here to help.

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Longer Reads

Coronavirus: Furlough Leave – Updated Government Guidance

The HMRC online portal is now open for applications from businesses looking to claim 80% of the wages of their furloughed employees. Government guidance for employers and employees continues to be updated and our Employment team provides a rundown of three key points.

Published 23 April 2020

Associated sectors / services

  • Employment law for employers
  • Employment law for employees

Authors

The HMRC online portal is now open for applications from businesses to claim 80% of the wages of furloughed employees up to £2,500 per month per employee.

More than 140,000 businesses applied using the portal for over 1.3 million employees on the first day alone. The portal can be accessed here.

Government guidance for employers and employees has continued to be updated since the portal went live on 20 April 2020, and we provide a rundown of three key points here.

Annual Leave

The updated guidance has confirmed that employees are free to take both bank holidays and annual leave whilst they are furloughed.

In the absence of a contractual agreement otherwise employers will need to pay the holidays of furloughed staff at their pre-furlough remuneration. This is likely to take the form of a ‘top-up’ from the government contribution to the pre-furlough contractual salary.

Statutory Sick Pay

The guidance states that the Coronavirus Job Retention Scheme (the Scheme) is not intended for short-term absences of employees as there is a three-week minimum period during which employees must be furloughed. Therefore, employers should not consider short-term illness or self-isolation as reason in itself to furlough. However, if employers wish to furlough employees who are not required in the business and those employees happen to be off sick that does not preclude them being furloughed.

Employers are also able to furlough workers who are on long-term sick leave. If this is done, employers will be able to claim under the Scheme for the period when the employee is furloughed and from the SSP rebate scheme for the period when they are on sick leave. However, these must be independent claims and an employee can only benefit from one regime at a time.

Should an employee who is not furloughed become ill or need to self-isolate then employers may apply for the SSP rebate scheme and make a claim for two weeks of SSP per employee.

Delayed Furlough Grant

The guidance has confirmed that employers do not have the unilateral right to delay paying wages pending receipt of the Government’s grant covering 80% of salaries up to £2,500.

Any agreement to delay wages, for example pending receipt of the furlough monies from HMRC, must be accepted in writing by the employee either as part of the furlough agreement or otherwise.

The Government has announced that the grant should be paid within six working days of a successful application being lodged with the HMRC portal and so it may be possible for businesses to apply in a timely manner and receive the grant in time for the April payroll.

If you have any queries about your specific circumstances, our specialist Employment team are here to help.

Associated sectors / services

  • Employment law for employers
  • Employment law for employees

Authors

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