There’s more change to the furlough scheme with HM Gov’t introducing a mark 2 scheme from 1st July.
Full details to be released shortly; but the key point for you right now is that the new scheme is closed to workers who have not previously been furloughed. A worker can only be included in the mark 2 scheme if that particular worker has previously been furloughed for at least 3 weeks in the period up to 30 June. This means that the final day to start furloughing someone for the first time is 10th June, to get that 3 week run in to 30-Jun. To be clear: you don’t need to inform HMRC by 10th June; what is required is that you retain evidence in writing that you made the necessary employment changes to furlough someone.
Another restriction is that the number of furloughed employees in the new scheme cannot exceed the maximum number of furloughed employees on any claim made up to the end of June.
The only additional info we currently have about the new furlough scheme is from bits of guidance from a Gov’t fact sheet, which amounts to the following:
- HM Gov’t refers to the new scheme as flexible furloughing. The good news is that you can bring back staff on a part time basis, whether this be for an hour or a day or longer, and then place them straight back on furlough once that work is performed. The 3 week minimum furlough period is going.
- The bad news is that the amount of Gov’t support is reducing. No changes in July but in August you will be expected to pay employer’s national insurance and pension costs. From September you must also pay 10% of salary costs and then from October it’s 20% of the salary.
- And after 31-Oct-20 it’s all over.
So, any questions?
We have 3 people (out of 6) who are furloughed. It would be best for the business if all 6 worked part time rather than 3 full time, so are you saying that we need to furlough the other 3 by 10th June if we are to have everyone working part time next month?
Yes. This means some of you are going to have to plan your likely labour requirements over the next 5 months right now. If there is any possibility that you might want to furlough any ‘not previously furloughed’ employees after this month, then you should now consider furloughing those employees on or before 10 June 2020 to keep open your option to make future furlough claims for that employee.
But a word of caution – the purpose of the furlough scheme is to enable businesses to retain their employees rather than making them redundant. So if you furlough people with the reason of “so that we can put a claim in for them to work part time later”, rather than with the reason of “so that we don’t have to make them redundant as otherwise we don’t have any work for them to do as a direct result of the coronavirus pandemic”, perhaps the claim could be vulnerable to challenge.
Talking about challenge, HMRC reports 1900 calls so far to its whistle blower hotline.