On 26 March HMRC provided much welcomed further details for employers on its Coronavirus Job Retention Scheme (CJRS), and also published guidance for employees. This can be found at this website: Claim for wage costs through the Coronavirus Job Retention Scheme. This further clarity is welcome as it will allow many more employers to now make key decisions and communicate what this means to their employees.
The guidance provides more information in respect of a number of areas and as a consequence the outline of the scheme is now much clearer. The headline features include:
- Eligible businesses: generally this is all employers who had a PAYE scheme and UK bank account on 28 February 2020.
- Scheme duration: 3 months from 1 March 2020, although this may be extended.
- Employees who can be furloughed: generally this is any employee who was employed on 28 February. There are specific rules for those on sick, maternity or unpaid leave, and therefore these populations should be considered separately.
- Conditions for furloughed employees: the furlough should be for a minimum period of 3 weeks, up to 3 months (although this may be extended). Employees cannot work for their employer whilst furloughed, however it may be possible for them to undertake training.
- The amount which can be claimed under CJRS: this is the lower of 80% of regular wages, or £2,500 per employee, per month. In addition the costs of employer’s NIC and minimum pension auto enrolment costs can be reclaimed. There are specific rules which apply when determining regular wages for those who are salaried, and also those with variable pay. There are also rules around how to calculate the pay for those with less than 12 months employment and those on zero hour contracts.
We know how important this is so we have recorded a webcast for you to view that talks through some of the key announcements that have been made and what you can do now to address this and how we are able to support you with this. You can view our webcast by clicking here.
Please let us know if you would also like to arrange a call with our specialist team who are supporting clients in working through the key decisions/operational matters which are relevant to making this claim.For further insights on COVID-19, please see our website.