Government publishes guidance on flexible furlough rules
More information about new flexible furlough rules has been made available.
The flexible rules mean that, from 1 July 2020, furloughed employees will be able to come back to work flexibly, while still claiming for the hours they are not working. This is only the case for employees who have successfully claimed a previous grant.
In order to qualify, employees must have previously been furloughed for at least three consecutive weeks, taking place any time between 1 March 2020 and 30 June 2020. For the minimum three consecutive week period to be completed by 30 June 2020, the last day an employee could have started furlough to be eligible would be 10 June 2020.
The following advice has been released by the CIPD for HR and payroll managers to understand the different deadlines and rules.
Flexible furlough
From 1 July the furlough scheme becomes more flexible before it ends completely on 31 October 2020. The flexible scheme applies to employers currently using the scheme for previously furloughed employees. Employees will continue to receive 80% of their salary, subject to the cap, but employers will need to share the burden of paying NI and furlough salaries from August onwards. As under the original scheme, employers can top up the wages above the grant for fully furloughed staff if it is feasible for them to do so. Employees can work part-time under the revised flexible scheme. The capped figures on the furlough pay will apply in proportion to the hours not worked.
There are now the following five stages:
June
From 10 June the furlough scheme is effectively closed for employees who have not been previously furloughed. Until 30 June employers can claim for 80% of furloughed employees current salary, up to £2,500 but the employee must not work for the employer. Employer National Insurance Contributions and certain pension contributions can be claimed too. Employers are not required to contribute anything towards furloughed employees’ salaries for June.
July
The new flexible scheme applies only for previously furloughed employees. These people can now return to work part-time, but employers can still claim the grant for normal hours not worked. Any amount of working time and any shift pattern can be agreed with the previously furloughed staff. Until 31 July, employers can still claim for 80% of the furloughed employees current salary, up to £2,500 as well as employer National Insurance Contributions and pension contributions. This only applies for the hours the employee doesn’t work. Employers must pay employees for the hours they work.
August
The main change is that, from 1 August, employers will have to pay employees’ National Insurance Contributions and pension contributions, and can no longer claim a grant for these. Until 31 August the government will pay 80% of furloughed employees wages up to a cap of £2,500 for hours not worked. Employers must pay employees for the hours they work. Employers funding of employers’ NICs and pension contributions applies to both the hours not worked and hours worked if any.
September
From 1 to 30 September the government will pay 70% of furloughed employees wages up to a cap of £2,187.50 for hours not worked. Employers will pay 10% of wages to make up 80% total up to a cap of £2,500 plus employers’ total NICs and pension contributions.
October
From 1 October until the end of the scheme on 31 October the government will pay 60% of wages up to a cap of £1,875 for the hours the employee does not work. Employers will pay 20% of wages to make up the 80% total up to a cap of £2,500 plus employers’ total NICs and pension contributions.
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