WHAT IS FLEXIBLE FURLOUGH?
The new flexible furlough scheme starts on 1st July 2020. Under this scheme employees no longer need to avoid doing any work for the employer and they can work for part of the week and be furloughed for the rest of the week, in proportions decided between employee and employer.
The minimum three-week period for furlough will be removed, although any claim through the CJRS portal mut be in respect of a minimum of one-week period (i.e. employers can only put in four claims per month, not 31)
Can you claim
Which employees can be on Furlough
Steps before the calculation a claim
How much should you claim
You will need to calculate how much you must pay your furloughed employees for their hours on furlough, how much you can claim for employees NICs and pension contributions and how much can claim back.
Report a payment
Broadly, from 1 July, employers will claim a pro-rated amount of 80% of salary, based on the proportion of hours not worked out of normal working hours. To calculate the normal working hours for those with fixed hours/pay, you simply take the number of hours worked in the pay period before 19 March 2020.
To calculate the normal working hours for those with variable pay, you take the higher of (a) the average number of hours worked in the tax year 2019 to 2020 or (b) the corresponding calendar period in the tax year 2019 to 2020.
From 1 August 2020, the level of grant will be reduced each month. To be eligible for the grant employers must pay furloughed employees 80% of their wages, up to a cap of £2,500 per month for the time they are being furloughed.
The timetable for changes to the scheme is set out below. Wage caps are proportional to the hours an employee is furloughed. For example, an employee is entitled to 60% of the £2,500 cap if they are placed on furlough for 60% of their usual hours:
Employers will continue to be able to choose to top up employee wages above the 80% total and £2,500 cap for the hours not worked at their own expense if they wish.
Employers will have to pay their employees for their actual hours worked.
The table shows Government contribution, required employer contribution and the amount an employee receives where the employee is furloughed 100% of the time.
We have a dedicated article where we answer some of the FAQs about the furlough scheme if you need more details. If you would like further guidance or support on this matter please contact Clover HR on 0121 516 0299 or email us at email@example.com.
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