Coronavirus Update: Additional Advice on Furlough Leave

FREQUENTLY ASKED QUESTIONS ON FURLOUGH LEAVE

Will Furlough Payments cover an employer’s NIC and Employer Pension contributions?

Yes. Employers can apply for a grant to cover their NIC and pension contributions on 80% of regular salary (up to £2,500 per month).

Does this only apply to ‘essential’ businesses?

No. All businesses that employ and pay workers through the PAYE system are eligible.

Do employees have to pay tax on Furlough Payments?

Yes. Employees will pay NIC and Income tax on payments received.

How does this work for zero-hour, flexible contract or agency workers?

The Furlough scheme will cover all employees employed through the PAYE system regardless of employment contract. The Furlough scheme covers 80% of the higher of

  1. earnings in the same period in the previous year
  2. average earnings in the previous 12 months (or fewer is they worked less time)

Does this support employees with reduced hours?

No. It only covers employees who would otherwise have been made unemployed. The welfare system has been strengthened to support reduced-hours workers, increases to the UC standard allowance and more.

Does this cover employees hired in March?

No. This only covers employers on your payroll on or before Febuary 29.

Does this support part-time workers?

No. This only covers those who would have been unemployed.

Can I furlough workers for a few days at a time?

No. Workers must be furloughed for a minimum of 3 weeks for employers to be eligible for the Furlough scheme.

Can I sack workers on furlough?

Yes. Employees can still be made redundant while on furlough or immediately following furlough. However, regular redundancy rules and protections apply including a notice period and consultations.

Can employees volunteer or do training while on furlough?

Employees can volunteer or train provided their volunteer or training does not involve manufacture, provide services, or create goods that can create revenue fora company, Firms can require workers to undertake training (at home) provided it meets these same criteria.

This is condensed from FAQs provided by Dr Luke Evans MP, Member of Parliament for Bosworth on 26 March. The full text is here.

UPDATE: Government published additional guidance on 26 March.

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FREE FURLOUGH LETTER

DLP is offering a Furlough Letter employers can use to place employees on Furlough.

Additionally, we are making our Independent Employee Integrity Helpline available to any employee for the duration of the COVID-19 outbreak in the UK. Should you have an employee with questions, feel free to share the number for this free service: 0330 400 4493.

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