Consequences of Abusing the Coronavirus Job Retention Scheme

HMRC has been clear that it will investigate any suspected abuses of the scheme, and has said it will not hesitate to take criminal action in the most serious cases.

STATISTICS

  • 
One million employers used the scheme
  • 8.4 million jobs affected
  • £15 billion in grants paid out
  • 
800 reports of fraudulent applications to date

The Coronavirus Job Retention Scheme has provided a lifeline for many organisations and their employees – but, like any scheme offering financial assistance, it is open to misuse. Some employers may be tempted to abuse the scheme – either by claiming on employees’ behalf without their knowledge, or by expecting employees who have been furloughed to continue working.

It’s important employers understand the potential consequences of knowingly making a fraudulent claim. And, given the financial and reputational risks involved, employers must also ensure they are clear on what employees can and cannot do while furloughed, to avoid inadvertently opening themselves up to claims they are defrauding the scheme.

The Coronavirus Job Retention Scheme was closed to new entrants on 30 June 2020. From this point, employers will be able to furlough only those employees who have been furloughed for a full three-week period prior to 30 June.

Moving forwards, now we are moving into Flexible Furlough Territory, it is still imperative to keep accurate records of hours worked on full pay and hours worked on Furlough in case you are audited by HMRC, which could be in 5 years time!

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