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Update Job Retention Scheme

Updates to the Coronavirus Job Retention Scheme

More updates to the Coronavirus Job Retention Scheme

Furlough Leave

HMRC has made further updates to the Coronavirus Job Retention Scheme to clarify some areas which were unclear.

The updated guidance can be found here https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme but the main points are:

  • Employers can switch employees from sick leave (and pay sick pay) to Furlough Leave and vice versa.  The update also makes it clear that employers do not have to place ‘shielding’ employees on sick leave but can Furlough them instead.
  • Employers can Furlough foreign nationals and employees on all categories of visa without it breaching the terms of their visa.
  • Employers can Furlough employees who transferred to them under TUPE after 28 February 2020.  Employers can also claim in respect of employees if the PAYE business succession rules apply to the change of ownership of the business after 28 February 2020.
  • Although employees can work for another employer during Furlough Leave, they cannot work for organisations that are linked to the employer.
  • Businesses that are engaged in payroll consolidation schemes after 28 February can place employees on Furlough Leave.
  • Employers can claim 80% of an employee’s wages up to a maximum of £2,500 per month. On top of this an employer can re-claim its Employer National Insurance contributions that it has paid on the subsidised Furlough Pay (this clarifies that the NICs are based on the Furlough Pay rather than the employee’s original pay).
  • All of the grant received to cover an employee’s subsidised Furlough Pay must be paid to them in the form of money. No part of the grant should be netted off to pay for the provision of benefits or a salary sacrifice scheme.
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