After Furlough Guide 28th October 2020

Posted: Wednesday October 28 2020

By: Banner Jones

After Furlough Guide 28th October 2020

We know… that as an employer and business owner these are very stressful and worrying times for you and your staff. We are here to help as best we can. With the furlough scheme ending and on-going decisions around the safe return to the workplace, home working and potential redundancies, we have updated this guide to cover the key points that your business may wish to consider. As always, we are here to help and if you would like any support over the coming weeks and months we are here for you however you need us.

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Banner Jones After Furlough Guide 28th Oct

  • After the Coronavirus Job Retention Scheme (CJRS)
  • Job Support Scheme
  • SSP and Self Isolation Support
  • Redundancy advice
  • Advice on returning to the workplace safely

This section includes information and advice on the latest changes to the Coronavirus Job
Retention Scheme (CJRS) and is correct at the time of writing. The most important thing to be aware of is that employment legislation has not been amended and that employment law rights still exist. So, as always, any decisions or actions need to be carefully considered and documented in writing. The CJRS ends on 31st October 2020 and is being replaced by the Job Support Scheme.

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  • Advice on your responsibilities as an employer during this process.

The furlough scheme ends on 31st October 2020.

To end furlough, you should give staff notice in writing. There isn’t a minimum notice period for furlough, but you should: talk to staff about any plans to end furlough as early as possible (unless already stated in a furlough agreement with the employee) and encourage staff to raise any concerns or problems about returning to work.

It may be prudent to start looking at how you might negotiate a reduction of hours or a reduction of salary with employees when they return from furlough leave, and if you can make use of the Job Support Scheme before considering whether you will need to make redundancies. If you are
considering redundancies, then please read our guidance on the process in the next section of this document.

Changing an employment contract

If you can’t reach an agreement with an employee or worker, you may decide that you need to change the written terms in their contract.

If there are 20 or more people affected, you will need to consult staff representatives (‘collectively consult’).

Can we introduce our own private furlough scheme?

Yes, when the CJRS ends in October you can introduce your own private furlough scheme. As with the CJRS, your contracts of employment must allow for this. If they don’t, then you will need to negotiate a change to the contract and if this involves 20 or more members of staff you may have to also involve staff representative or the relevant union as well as obtaining individual agreement.

A private scheme could be based on the same conditions of the CJRS or could have different conditions and pay levels. As always, everything must be in accordance with employment law, your contracts of employment and agreed in writing. You will also need to ensure that employees chosen for private furlough are selected fairly and that there is no discrimination in terms of
sex, race, age, disability etc.

What is the Job Retention Bonus?

The Job Retention Bonus is a one off payment that can be claimed by employers of £1,000 for each previously furloughed eligible employee who remains in continuous employment until 1st February 2021.

To be eligible, an employee must:

• Have been furloughed and meet all relevant eligibility criteria for the CJRS
• Have been in continuous employment from the most recent furlough claim up until 31st January 2021
• Have earned at least an average of £520 a month between 1st November 2020 and 31st January 2021
• Not be on contractual or statutory notice for a period that starts before 1st February 2021

Only earnings recorded through the HMRS RTI reporting can be counted towards the £520 a month average and employers must be able to show evidence of furlough claims and all PAYE records.

The Job Retention Bonus can be claimed through the gov.uk website after 31st January 2021.

Correction of furlough payments

It is up to you as an employer to ensure that you, and your employees, are following the rules of the CJRS, and to make sure you have not been overpaid.

HMRC is encouraging those who have taken advantage of the system to disclose any information relating to furlough fraud within a 90-day ‘correction window’. The tax authority says it will be lenient to any employer who uses this and returns the funds they claimed of their own accord – but those who don’t will face hefty fines.

The Finance Act 2020 includes civil penalties, which can be charged in cases where an employer is found to have used money paid through the CJRS for anything other than employees’ wages, National Insurance contributions (NICs), or pension contributions. In the hope that employers will admit to overpayments rather than risk an investigation further down the line, HMRC says it has made the process of repaying the money ‘as easy as possible’.

Ensure that your claims are valid and documented

As the CJRS comes to an end, it is vitally important that you ensure that any claims are accurate and fully documented. Inaccurate claims would be considered as CJRS fraud and companies
should be prepared to have their claims inspected. If a HMRC investigation finds that an employer has claimed money fraudulently, it could be required to repay any monies received and may also face further sanctions from HMRC.

We recommend that you retain written records detailing your
information covering your actions and the basis of your claim that
shows that:

• there is a commercial justification for the grant being claimed,
and there is no evidence of exploiting the scheme;
• there is documentation to support the rationale for people
being placed on and brought off furlough over the period the
scheme is in operation;
• key extracts from board minutes and partnership decisions
are included on the file to show due process is being followed.