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The information below is based on updated guidance produced by the UK Government and is not intended to deal with all aspects relating to the Coronavirus Job Retention Scheme (‘CJRS’). Further information about the CJRS is available on the Backhouse Jones resource hub. If you would like the below information in a downloadable PDF format, please click here.
This update is valid as at 23 April 2020.
Key Points
1. Coronavirus Job Retention Scheme Portal
2. Annual Leave
3. Written Agreement
1. Coronavirus Job Retention Scheme Portal
The CJRS has been live since Monday 20 April 2020 and many employers have been using the service to reclaim monies paid to employees since they have been furloughed. As you can imagine there was an initial scramble to register for the online portal which caused problems for some but these issues seemed to be resolved now.
In order to make a claim through the CJRS portal, you must have the below information before starting to complete the application:
- The number of employees being furloughed.
- The dates employees have been furloughed to and from.
- Details of employees – the name and National Insurance Number of each furloughed employee.
- Your employer PAYE scheme reference number.
- Your Corporation Tax Unique Taxpayer Reference, Self-Assessment Unique Taxpayer Reference or Company Registration Number as appropriate to your entity.
- Your UK bank account details.
- Your organisation’s registered name.
- Your organisation’s address.
In addition to the above information, the employer should ensure in advance of making their claim that they have worked out:
1. The total amount being paid to furloughed employees.
2. The total employer NICs.
3. The total employer pension contributions (up to 3%).
2. Annual Leave
The legal interaction between annual leave and periods of furlough has not always been made clear when it comes to reclaiming monies through the CJRS. Further guidance has now been issued but this does leave some outstanding questions.
We know that furloughed employees continue to accrue leave as per their employment contract. It is also suggested that employees have the right to request holidays and take them as normal during the period of furlough. The impact of that annual leave on furlough has not always been identified however, leaving many employers concerned about granting leave in the event that this broke the period of furlough (which has to be a minimum period of 3 weeks) thus preventing or delaying a claim under CJRS.
Working Time Regulations require holiday pay to be paid at the employee’s normal rate of pay or, where the rate of pay varies, calculated on the basis of the average pay received by the employee in the previous 52 working weeks. Therefore, if a furloughed employee takes holiday, the employer should make sure to top up their pay to 100% if currently paying 80%. Any furlough agreement reducing the level of pay to 80% or £2,500 (maximum claim under the scheme) will not alter “normal pay” for the purpose of annual leave.
If an employee takes annual leave whilst on furlough, while the employer must pay 100% of that employee’s pay, they may recover 80% of that payment through the CJRS for the period that they are on annual leave.
If an employee usually works bank holidays, then the employer can agree that this is included in the grant payment. If the employee usually takes the bank holiday as leave then the employer would either have to top up their usual holiday pay or give the employee a day of holiday in lieu.