EMERGENCY measures have been put in place for workers in the fight against the coronavirus pandemic, including covering the wages of millions.
The Chancellor, Rishi Sunak said the Government will cover 80 per cent to those who have been furloughed – but what exactly does that mean?
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Rishi Sunak has said there will be help for furloughed workers[/caption]
What are furloughed workers?
Furloughed workers are those who are unable to work due to the coronavirus pandemic because their places of work have been forced to close.
They are not people who have been made redundant.
Their employers are now able to access support to continue paying part of their staff’s wages, to avoid redundancies.
What is furloughed leave?
Employers who wish to access the job retention scheme should speak with their employees about classifying them as a furloughed worker.
This would mean that employees are kept on the payroll, rather than being laid off.
According to the Government, furloughed staff should not undertake any work for their employer during the scheme.
This allows employers to claim up to 80 per cent of wages – with a limit of £2,500 per month.
The Department for Business, Energy and Industrial Strategy says: “To qualify for this scheme, you should not undertake work for them while you are furloughed.
“This will allow your employer to claim a grant of up to 80 per cent of your wage for all employment costs, up to a cap of £2,500 per month.
“You will remain employed while furloughed. Your employer could choose to fund the differences between this payment and your salary, but does not have to.
“If your salary is reduced as a result of these changes, you may be eligible for support through the welfare system, including Universal Credit.
“We intend for the Coronavirus Job Retention Scheme to run for at least 3 months from 1 March 2020, but will extend if necessary.”
Who can be furloughed and how do I claim my pay from the Government?
Any UK employer can apply for the furlough scheme, including business, charities, recruitment agencies and public authorities.
However the Government does not envisage making significant payouts to public sector employees as they believe most will continue offering essential services.
Where employers are receiving public funding for staff costs, they will be expected to continue using these funds to pay staff rather than applying for the furlough scheme.
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If you are working at reduced hours and pay, you will not be eligible for furlough and it will be up to your employer to pay you as normal.
You must have created and started a PAYE payroll scheme on or before February 28, 2020 and have a UK bank account.
To access the scheme, your employer must comply with the following:
- Designate employees who cannot do their jobs due to the coronavirus measures put in place by the Government
- Notify those employees of their new “furloughed” status
- Submit information to HMRC about furloughed employees to set up a system for reimbursement and existing systems that will facilitate payments.
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Can I take another job while on furlough?
The Government does not prevent workers from taking on other jobs while on furlough.
However, you should speak to your employer first as you are still technically working for them.
Some contracts may prohibit employees from taking up other work, but be subject to negotiation.