A full step-by-step guide is provided here which outlines what needs to be considered before making a claim, how to calculate a claim, how to make a claim and what to do afterwards.
Before the portal was opened today however, on the 17th April, HMRC also issued a further wave of guidance for employers which included the news that the Scheme will be extended until the end of June 2020.
This further guidance includes information on how to work out 80% of your employee’s wages.
It provides guidance on what amounts can be included in the “reference salary”, what happens after the claim is made and the tax treatment of the grant. Lots of scenarios are given on how to treat grant payments in Real time information and how much can be claimed for National Insurance and pension contributions. A key point is that employers must claim for all employees in each claim period at one time – changes cannot be made to the claim once it has been submitted.
HMRC have confirmed that annual leave continues to accrue during furlough (including any contractual enhancement on top of the statutory entitlement – unless agreement has been made to vary this enhancement during furlough). Holidays (including bank holidays) can be taken during furlough and the employer should pay 100% of usual pay (pre-furlough) for days of annual leave. HMRC does also state that they are keeping the policy on holiday pay during furlough under review.
In relation to those employees returning from unpaid parental leave, sick leave, unpaid sabbatical or other unpaid leave, the guidance makes clear that the reference salary should be based on the normal salary before that leave
Other key changes to the employer guidance on the CJRS include:
- HMRC will check claims made through the scheme and that payments may be withheld or need to be repaid in full to HMRC if the claim is based on dishonest or inaccurate information or found to be fraudulent. An online portal has also been created for employees to report abuses of the system eg. the employer not paying the monies claimed under the scheme to the employee, asking the employee to work whilst on furlough or making a backdated claim to include periods when an employee was working.
- Fixed-term employees who are furloughed can have their contracts renewed or extended without breaking the terms of the scheme. This can only be done before the contract would otherwise have ended.
- For Agency workers who are furloughed, the guidance clarifies that they cannot work for the agency’s clients where this is through or on behalf of the agency.
- The guidance on recording the terms of furlough has been amended most likely pursuant to the Treasury Direction which provided that there needs to be written agreement between employer and employee that the employee will cease all work in relation to their employment during furlough. The latest version has been updated to provide: “To be eligible for the grant employers must confirm in writing to their employee confirming that they have been furloughed. If this is done in a way that is consistent with employment law, that consent is valid for the purposes of claiming the CJRS. There needs to be a written record, but the employee does not have to provide a written response. A record of this communication must be kept for five years.”
For full details of the updated guidance, please click here.
HMRC have also provided updated guidance for employees: Check if your employer can use the CJRS.
Our employment law expert Lisa Aitken, at Moore & Tibbits has in-depth knowledge of employment law and the details of the coronavirus job retention scheme. If you are an employer and require advice on your furloughed employees or you are an employee and have questions about furlough or any other aspect of your employment, please call for a free initial telephone consultation. Lisa can be contacted on 07960 469988 or email: LisaA@moore-tibbits.co.uk