Good afternoon, everybody. Welcome to our latest webinar, this time, looking at the latest position with the coronaviruses job retention scheme.
It's been somewhat of a constantly moving goalpost with the job retention scheme. Of course, we had some updates last in the last couple of weeks, which confirmed dates at the scheme of now moved, been extended to the end of October. And we're going to have this concept of Flexible following from the beginning of July. So I'm going to kind of give a quick recap of furlough scheme where we are, what's coming up in the coming weeks and months and at the end of the session, we can take some questions. Probably happy to answer any queries you may well have.
So in terms of introductions, my name is Rhys Wyborn, I'm a partner here at Shakespeare Martineau dealing with employment issues, based in the Nottingham office, Seems to see we've been very busy with job related furlough queries since the scheme was implemented back on the 20th of March.
Should all be aware. It was implemented by the Chancellor with a view to saving as many jobs as possible and giving employees support to try and keep jobs open and avoid the large-scale redundancies. Otherwise contemplated, before the scheme was introduced.
It's complemented by a portal, that is run by HMRC and that opened on the 20th of April. And that's where employers can put their claim in for the rebate that the government has provided for, under the job retention scheme up to 80% of wages, or £2500 a month together with employers, national insurance contributions, and auto enrollment action contributions. So, that's the scheme, as it stands now. And the key concept with the current scheme is that fellow staff must do their work, So, they are furloughed by agreement. And the key thing is they don't do any work.
What's changing? And just to kind of give an update as to the figures that Ritchie Soon, ... announced when he made this updates in the end of may be, commented that the schemes being used by about a million employers to protect around 8.5 million jobs. And you record the total value of claims to the 24th of May with some £15 billion. So it's been hugely taken up and has come at a great cost to the public purse. And that is going to continue now to the end of October with some changes, as I'll come on to now.
So, first, changes from the first of July. So, this is where this concept of Flexible furling is going to come into place. And it's going to allow employers to start bringing stuff back to work on a mixture of them, meeting some of the hours and paying the cost and still having furlough in the background. Whether the powers that the employer cannot provide for still look to the 80% or £2500 cat.
Thereafter, there's going to be a sliding scale of contributions from the government. So, in July, the scheme continues, as is, with a government contributing with the 80% or £25,000 cap, and also the employee being able to claim employers national insurance contributions, and auto enrollment pension contributions.
In August, that still, the same figures are still 80% of pay or £2500 cap, but the employer will need to meet the national issue and the pension costs. And then in September, there was only going to be a 70% allowance from the government. So that's capped at 2000, 197, Pounds, 50, finishing on to the end of October, where it's going to be 60% from the government, So capped at 1875 with the employer making up the difference. So in essence, those staff that remain furloughed until the end of October will still receive their 80%, but it's going to be a sliding scale of support from the government, depending on when the claim is made by 80%, 70%, or 60% rebate, and the final month in October.
So, this is all now starting to gear up and getting staff hopefully ready to return to work and the idea of having this flexibility in place where there are no limits as if being stated as yet. In terms of the minimum number of hours or days that an individual must work is to try and facilitate where there's some work to be done as the lockdown is lifted, where we can start bringing stuff back to work. Paying them to the hours that they're working for the employer, while still having support in the background, from the government, to be able to top up those wages up to the 80% or £2500 per month in the first couple of months and sliding down in September and October.
The key thing is, in returning staff is that you have to agree the hours with them and get that in writing. There is going to be the potential for audits by HMRC. After the job retention scheme closes they're going to want to make sure that claims have been validly maize, individuals have been placed on furlough. That has been no work while in visual being further up to the beginning of July. At all the requirements and eligibility factors have been properly carried out. So, for this reason, having a good paper trail, having the right documentation in place to show when stuff, off load, and when they were cruel backend, on what basis, will help in the event you are audited and have to prove the claims were properly made.
So, I think that sort of sets out to where we are now. And say what we've got in terms of the latest with the job retention scheme. I'm going to hand over to download it and see what questions we've got. Gladly answer those as they come in.
OK, so the first one is, Can an employee request an employer to put them on prem and press the employer have to agree?
OK, so that's a question we see in fact sheet on a regular basis. Particularly with staff who are being asked to return to work with and are being told his work available for them and I got used to stay at home and they want to continue that arrangement. And the key thing is it's really a scheme as his employer led. So it's not for the employee to call the shots is for the employer to manage their business as they see fit. Said The employer deems furlough a suitable provision, bearing in mind the work available in that business. The applicable time is for the employer to agree with the individual not for the employee to insist that they are fellows.
OK, and what is flexible?
So this is the sage variation to the scheme that was introduced at the end of May, which is coming into effect from the first of July. It was initially expected that July was going to stay the same with no change, and they would just simply be no work. Stay at home further. You'll get your 80% or two point five thousand pound kept wages. But when the Chancellor announced this at the end of May, A brought forward this notion of flexible fell away because there is the hope that businesses are starting to pick up. And as we can out of lockdown, that, will be more scope to have stuff returning more quickly. So, the idea being is that you will agree with stuff that they can return to work to carry out certain hours. You will agree with the individuals, what those hours will be. The employer will meet those costs at the normal rate of pay for the work that individuals are doing.
And then in the background, as I mentioned, there will still be the ability to claim the rebate from the government through the job retention scheme up to the limits that are now being provided for.
Another one? We will be eligible for Flexible.
Rather than having to be, Rather than having to be on time firm, call, an employee was on trial run from 24 months.
They've worked in the business full-time fastest May, but we would like to put them on part-time from 15 to 19 31st of July. Is this possible?
OK, so at the moment, the guidance doesn't really say there's no ability to have somebody who has been previously furloughed put back onto furlough for the continuation of the scheme up until the end of October. And I should say that with a caveat in the sense of we are expecting a third the publication of the relevant guidance around the scheme to be made on the 12th of June. So at the end of this week, and I think that will take us without version seven, version eight of this guidance, we've got two versions of at Treasury direction, all of which deal with the job retention scheme. But all that State is at the moment, in the announcement that was made is that new entrance to the fellow schemes for anybody who hasn't previously being furloughed.
So it would be the first time that they are being put on Photo, would have to be put on furlough by the 10th of June, because that will allow the three week minimum period of furlough to have been served by the time we get to the end of June. And that's the cutoff point for new claims and the further skeet.
So that does suggest that if somebody has previously being furloughed in March or April, they are effectively already in the system and they would be within the system and the portal HMRC for the clay previously made in March and April. Therefore they have come back and done some work in May and therefore are being taken off though there will still be the ability to put them back home to furlough under the flexible surveying or even pure furlough for August, September, October as applicable. There is nothing that's been set out in the scheme updates in terms so far that will suggest that that's not possible. The key requirement is that they'd be in fairly previously, and, therefore, already in the system.
OK, OK, another one from my Coma, I have an employee unmet needs, he went return Turtleneck, July. I seems she can now be Friday night, Is this correct?
So again, I mean, the crossover with maternity leave and furthering is in coming off maternity leave to go on, further leave your effectively ending your maternity leave. So you would then be able to come back, have a period of furlough, and then want to take the balance of your 52 weeks maternity leave because you would have brought that to an end. So for those individuals, I guess I need to think what is best in terms of the time off they need with their child? Do they want the longer period, in which case they would remain on maternity leave? Or if they are happy to waive the rest of that message to the period, to come back to be furloughed? Again, that would be fine, and they will then receive the applicable rates of pay, under the scheme, but it would just mean that will, then, their entitlement to maternity leave. And again, I go back to the point I made previously.
If that individual hasn't previously being furloughed before the 10th of June because they've been on maternity leave, and this all happened before, potentially they went on maternity leave, then they wouldn't be eligible to be put on furlough because they were not meet the required deadlines. So, that was going to happen would have to happen pretty quickly. Otherwise, there would be a new entrants to the fellow scheme after the 10th of June and so they will fall through the cracks and wouldn't be covered.
Can an employer insist on Frontline staff using holiday and how should they go about this? So, the first place to check is the employment contract. So, firstly, I should say is there is nothing in the scheme, although it took some sort of weeks waiting for the latest version of the guidance to clarify this. There is nothing in the scheme, which says if someone goes on Holiday, it brings an end, their fellow, and they then have to effectively go back on. So it wasn't dealt with when the Scheme was first an animal. So lots of employment commentators saying, how is holiday going to interact with fellow leave?
That has not been addressed, So, individuals certainly can take holiday while they are furloughed received a normal rate of pay while they are on holiday. Now, the issue of if they built a holiday and the employer wants them to use some of that holiday, rather than banking it for when they return to work. Well, hopefully everyone wants to then be working at full capacity to catch up on some of the lost output during this sort of unprecedented situation.
Then, yes, there is potentially provisions in the employment contract, which gives the employee a contractual power to say, we have the right to request that you take certain periods of holiday as protocols such and such. Whether therefore, implementing that contractual provision. If the contract is silent on that option, There is a provision in the Working Time Regulation, which again, does give that ability, and it you have to give twice the amount of notice of the holiday that you want the individual to take. So if you want somebody to take one day holiday, for example, you would simply have to give them two days notice in accordance with the relevant provisions of the working time regulations. So, yes, Ensure there is our ability to do so.
OK, so we have one which says that confusion confusion at the hands, and we have been living on a road to bases to count in terms of the attitude and eligibility from first team.
Yes, So again, as the rules are set out to present, provided those individuals on that rotating basis have previously been in the system and have had claims for rebates before the 10th of June. Then they will not be a new entrant to the scheme. And so if they then, are furloughed in July or August, they would still be eligible to be claiming back those payments for those individuals.
So the key thing is that they've been on the road. And they've previously been on furlough before we get to this cutoff date at the 10th of June.
And how would you bring stuff back to work different hours OT teams, to those they weren't previously?
For example, the potential for weekend racking, would you have to consult in the normal way depending on the contract?
Yeah. So, so, the key part is agreeing that return with the individual, and of course, that will include agreeing the terms which are going to apply for their return. If they're not coming back to do simply what they were doing previously. And so there's going to be a contractual variation, then whatever, you're agreeing variation two terms and conditions that needs to be consultation. Now, in these circumstances, one would hope that would be fairly straightforward, bearing in mind. You know, we're trying to preserve jobs here, we're trying to avoid redundancies, we're trying to keep businesses open, the doors open, to continue employing people. It will therefore be hoped that individuals will be receptive to, look, there is some work, and these are the hours in terms on which will lead you back. In which case, you document that you issue a letter and have the individual sign effectively give their consent to that variation.
If there was a large number of individuals who are resisting that change, then you might have to think more widely about, if there's 20 or more people where you're maybe having to force through those changes to terms, There might be collective redundancy or collective consultation requirements, which you'd need to take advice on, So the number of individuals you're dealing with is important. And I guess the resistance to those changes to ours, again, is something that you need to think about if it's agreed, and you can get their consent in writing. That is an agreed variation, than you then just agree those terms on which they come back.
OK, I'm another one.
If we agree someone returns to work, 50% of the usual working time in July.
Can you confirm how much we can train? Is it still 80% of the total, fairly subjective and it even working, 80% of non working time?
Yes, so it's based on the hours, they would normally work, and the 80% is to say that the cap or the £2500 per month is what remains in July.
So, of those normal working hours, the employer would pay for the hours that are, being worked by agreements as part of the return to work, and then we'll be able to claim the additional hours, or haven't been worked up to the full 80% cost or £2500 per month.
There are calculators which have been updated, or if they haven't been, there will be updated following the next version of the guidance at the end of this week, which will, again, set out more detail on how you have to spell out the hours that are being worked and the hours that you were effectively claiming for those normal working hours to give the rebate and the updated scheme.
I think this is also why they're saying it's only open for sort of new entrants up until the 10th of June because from the first of July and that will actually take them the next three weeks being the minimum period required for furlough. From the first of July effectively, it's going to be a new scheme based on say the updated information that's going to be put into the portal.
So, another one, we have a number of staff.
Permanent for 12 weeks.
What happens out in time if their health condition and it means that they cannot time, they can remain furloughs.
So, again, I think if there is still the inability for that individual to return to work because of health concerns, because of legitimate reasons where it's a role that can't be done from home and, you know, the individual won't take the risk of coming back into a workplace where they feel they are still potentially putting their health at risk. They can remain on the furlough scheme as a continuation of having being furloughed previously. So, there might be a discussion between the employer, that individual to explore whether there is work to be done, that can be done from home or if the right measures can be put in place to protect the health and well-being in a return to work. Because that simply isn't possible bearing in mind. The individual circumstances they would remain furloughed and the employer would continue to claim from the CJR S the Rugby payments.
OK, can you please clarify about salary sacrifice? How does that impact calculations?
To be off the top of my head, I can clarify. I must say, since all follow that one separately, that there is a separate calculator, which deals with where you have salary sacrifice and how that into plays with the job retention scheme. I must admit I have not done one for clients recently, in terms of how it into plays with salary sacrifice. So it's something I'd have to look at and follow up with separately.
And then, what are your thoughts on those who have been teaching, and the maximum that are allowed to be permanent progress to July.
Again, provided they are in the system and there have been furloughed previously, then, they will still be eligible to be furloughs depending on what work the employer has, going forward into the updated scheme through to the end of October. And then what the additional clarification we've had so far so far. I'm very mind there is more expected on the 12th of June. It simply says the employer won't be able to claim for more individuals that they have claimed for previously. So, again, that's trying to flush out and stop employers from introducing new individuals to the furlough scheme than has been submitted for previously. But for those on a rotational bassist, they will have been in the system for furlough payments previously.
So if they go back off in July or August, then the employer will still be able to put it in a claim for that rebate in accordance with whatever hours of work being worked under that updated scheme.
And what should we do if someone is refusing to come back to work as they didn't feel safe?
Even though the risk assessment has been done, but they didn't feel safe jumping on public transport.
Yeah. So this is a really hot topic, and, you know, a difficult one for employers. It has to be said. They do own health and safety duties alongside their employment obligations to staff. The staff also have a duty to act reasonably in response to reasonable management instructions, and those two at the moment are on a collision course for potential conflict.
Now, there are some provisions in the Employment Rights Act, which give protection to individuals where they feel there is an image, and real risk of danger to that, The health and safety, and that has to be based on simply a reasonable belief. So, it's not a high threshold, in terms of having to show that they were genuinely fearful of the health and returning to work. Be that commuting, be that, not having the right social distancing measures in place of work, pay for a vulnerable category. Whatever their belief may be based upon, if it is reasonable, then they have protection from being dismissed. So, if an employer would turn around and say, you're being unreasonable, we've done everything we can. We followed the guidelines, you must commit or else. And, they don't come in. And, they see through that threaten effectively dismissed for insubordination. Then that can be an automatically unfair dismissal and can lead to a tribunal play.
Or is it stop short of Latin? For example, may lead to withholding pay or some other detriment towards the individual. Again, there is some protection in the Employment Rights Act which could lead to a claim based upon that particular provision.
So tread carefully is the sort of advice I would give and if you're unsure before taking, you know, foolish decisions get advice and just make sure you're comfortable with the relevant risks OK.
Do disciplinary proceedings need to be paused once people are on far away?
Simple answer is no.
Again, at the moment, there is this sort of conflict between under the current scheme is very clear, individuals can do no work in return for being on furlough and then they get their 80% or kept £2500 per month. But other than volunteering and some minimal training, the guidance is very clear they mustn't do any work and so the question that has come up which hasn't really been dealt with in the Gardens is does going through a disciplinary process or grievance amount to work. And I think our view in the view of lots of commentators on this issue is where it's a straightforward discipline theory or personal grievance that the individual has raised. That is, you know, taking through that, that personal concerns. And that can continue. There are times where you might have to think about where it goes beyond that line. And may amount to work is if you have somebody who is furloughed and who may need to come back to forgive. A witness statement ought to give witness evidence as part of that grievance or that disciplinary process.
Again, that might be deemed to be work whereby in those circumstances, you might have to defer the, the disciplinary process until that individual is taken off. So, in general, yes, it is a straightforward disciplinary and grievance process where it's more complicated and you've got witnesses involved, that may be something you have to look at different. Right.
OK, and then I guess this question was two fold can, can an employee, they made redundant?
Yeah, there's nothing in the scheme that says that must stop job losses, It's just brought him to try and achieve that aim.
There will be many employers out there and we'll see we've seen the big employers, Alexa BA, and Rolls Royce, who are already making large-scale redundancies because they know, come. What May and where we get to the third? I leave scheme ending job retention scheme ending in October Lockdown, ending. They're not going to need all of these roles.
So, they're tackling that now that dealing with consultation now, and they're getting to the point where they're issuing a notice of redundancy.
Wallace scheme is still in effect. There a benefit to the employer in doing that because of the moment, there is nothing to suggest. the employer can't recover. 80% or whatever, the sliding scale will be, as we move tools October of those wage costs from the job retention skills, while somebody who's serving out notice. So for example, if you give somebody notices a tendency, issue them with a month's notice and that month is still wild, our furloughed, then you could get 80% of that cost back from the government under the job retention scheme. So redundancies also happening. They are not to put on hold as a matter of default just because we have the job retention scheme in place. But just make sure you still go through a process. You have a fair basis for redundancy or what option you will have to explore is why they can't remain furloughed. Because that will need to be dealt with as part and parcel of effect procedure.
OK, I'll just one final question then and what is the process to end? And what is the risk of boarded? HMRC scheme is closed.
I'll do the last one first and a sense of HMRC made it very clear that they reserve the right to audit all claims. Once the job retention scheme is closed and that's why they are suggesting in the gardens that the furlough agreement should be kept in writing and that should be kept for five years. Likewise, when somebody returns to work or taken off, or if there's going to be a sort of hybrid, flexible furlough, whether working some hours and being furloughed for the rest, Again, that's all dealt with in writing. So it can be checked in the event audits, are carried out as to how many orders are going to be carried out and what employers are going to be facing them, Who knows that Federal remains to be seen. But that said, if they feel with the amount of money that is being paid out, say we're already into a £15 billion territory, There is a chance that some of those claims haven't been validly made them, they will do their utmost to recover whatever money they can.
You know, they've been tipped off or notified of improper claims being made So have the right papers in place, make sure, you know, make the correct claims, and if an order does come in, you should be in a good place to deal with it in any event. I hope it's been a useful session, and thank you for tuning in. And say we will come back with any questions, we haven't been able to address, by way of follow-up. And thanks for tuning in.