On Friday 20 March 2020, the UK government announced a Coronavirus Job Retention Scheme (the Scheme) as part of its package of measures to help support businesses through the current COVID-19 pandemic. Following the announcement, separate guidance for employers and employees was issued but it is very early days in terms of understanding the detail of the Scheme; further guidance is expected in the coming days. What we know at the moment is:
- The aim of the scheme is to protect jobs and avoid redundancies arising as a result of the coronavirus crisis.
- The Scheme is available to any UK business, of any size and in any sector.
- It will be backdated to 1 March 2020 and will run for an initial period of three months, but may be extended.
- The Scheme allows an employer to designate certain individuals who are paid wages via the ‘pay as you earn’ (PAYE) system as ‘furloughed’, keeping them on the payroll as an alternative to terminating their employment.
- It is thought that all workers paid through the PAYE system, and not just employees, could be furloughed and covered under the Scheme but this needs confirming.
- There is no current guidance on how an employer selects individuals to furlough, nor how the scheme interplays with ongoing or upcoming redundancy activity.
- The issue of consent has to be clarified. On the information currently available, workers who are not receiving 100 per cent of wages will need to consent to be furloughed. Where employers are making up the remaining 20 per cent of wages such that the worker is not out of pocket, there is an argument that consent is not needed.
- It is clear that HMRC must be notified of the names of who has been furloughed.
Continue Reading Coronavirus Job Retention Scheme as at 23 March 2020