- The scheme applies to all PAYE employees, including apprentices, who were on the payroll on 19 March 2020 and notified to HMRC using RTI on or before that date. It also applies to employees who were made redundant, who can be re-employed and then furloughed. Employers can furlough employees whose roles are not entirely redundant but who have less work to do than they usually would, so long as they do not do any work during the furlough period. Employers can also agree to re-employee employees who resigned and have asked to return to their employer but care should be exercised in this scenario.
- The scheme applies to those furloughed "by reason of circumstances as a result of coronavirus or coronavirus disease", not just those who would otherwise be redundant.
- Employers and employees should agree that the employee will not perform any work whilst on furlough leave.
- Employers can make a claim to HMRC to reimburse 80% of usual wage costs, up to a cap of £2,500 (gross) per worker per month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer contributions on that wage. There is no obligation to top up to full salary, although employers can elect to do so. There is also no obligation to top up to national minimum wage if the 80% takes an employee below the minimum (unless the employee is doing training). Compulsory commission payments and fees may also be included.
- For employees on variable pay arrangements, pay can be calculated as the higher of either, (a) their pay in the same month of the preceding year (e.g. April 2020 based on April 2019 pay); or (b) their average earnings in the 20219/20 tax year. For those whose employment is less than one year, the average pay during their tenure can be used.
- Furlough claims can be made from the date an employee ceases work and commences furlough leave, not the date that furlough leave was agreed which is likely to happen in advance.
- For the avoidance of doubt an employee who is serving their notice can also be furloughed.
- Employees who have transferred under the Transfer of Undertakings (Protection of Employment) Regulations (TUPE) to the employer after 19 March 2020 may still be furloughed.
- During furlough, employees cannot do any work for their employer, although the scheme does allow employees to undertake work for another employer (should this arise employers should check whether the employment contract allows this). They can do volunteer work (employers can support their employees in finding volunteering opportunities), or training if this does not provide services to or for the employer, or generate revenue for the employer.
- An employee must be furloughed for a minimum period of 3 consecutive A furloughed employee can then return to work and put on furlough again later if needed, therefore allowing employers to effectively rotate furloughed employees.
- The scheme has been extended until the end of June 2020.
- HMRC’s online portal for the submission of claims opened on 20 April 2020.
- to be registered for PAYE online
- your UK bank account number and sort code
- your employer PAYE scheme reference number
- the number of employees being furloughed
- each employee’s National Insurance number
- each employee’s payroll or employee number (optional)
- the start date and end date of the claim
- the full amount you’re claiming for including employer National Insurance contributions and employer minimum pension contributions
- your phone number
- contact name
- your name (or the employer’s name if you’re an agent)
- your Corporation Tax unique taxpayer reference
- your Self Assessment unique taxpayer reference
- your company registration number