Coronavirus job retention scheme
11 May 2020
The Coronavirus Job Retention Scheme is a Government scheme under which an employer can furlough its employees if it needs them to stop work by reason of circumstances arising as a consequence of coronavirus.
Provided this is done in accordance with Government guidance this will allow the employer to apply to HMRC for the reimbursement of 80 per cent of their wages, plus the associated Employer National Insurance Contributions and minimum automatic enrolment employer pension contributions, subject to a limit of £2,500 per month. The employer may top up to the full rate of pay should it wish, even if that is in excess of £2500 per month. Any top up cost is not met through the HMRC furlough scheme and will be a cost borne by the employer.
The government expects that the scheme will not be used by many public sector organisations, as the majority of public sector employees are continuing to provide essential public services or contribute to the response to the coronavirus outbreak. The government have stated where employers receive public funding for staff costs, and that funding is continuing, we expect employers to use that money to continue to pay staff in the usual fashion – and correspondingly not furlough them. Before making an application to furlough staff, schools should consider the points set out below.
Considerations before making an application
It has been agreed that for schools that use Ealing Council’s Payroll that our payroll team will submit the furlough application for all those under Ealing’s PAYE. If you use an alternative payroll provider then you need to liaise with them directly over this matter as Ealing will not be able to process your claim.
You are asked to compete the spreadsheet (see download below) if you have staff that you feel meet the criteria for furloughing.
Please read the guidance in this notice before completing the spreadsheet and return it to Andrew Scully (HR Business Partner and Head of HR Operations) at this email address ScullyA@ealing.gov.uk with a copy to email@example.com by Wednesday 20 May 2020.
- First we must emphasise that we can give no guarantee that HMRC will accept the application made by Ealing either in full or in part
- You must have written to the employee to confirm they are being furloughed and that they will remain an employee. You must get agreement from them in writing that they agree to this temporary variation to be furloughed – please see the template letter from ACAS which is attached. If necessary this can be managed through email communications with the employee.
- You should be able to demonstrate that the post from which the employee is being furloughed doesn’t attract public funding (e.g. it is funded through private subscription)
- The government recognises that Early Years providers will have difficulty to distinguish whether staff are funded through free entitlement or private income and may be able to access the retention scheme to cover up to the proportion of its paybill which could be considered to have been paid for from that providers private income. Providers should initially use the month of February 2020 to represent their usual income in calculating the proportion of its paybill eligible to be covered by the scheme.
- You should be able to demonstrate that you have not been able to redeploy the employee to other duties to make up for the role being furloughed
- There is still uncertainty over whether an employee can continue to work in another contract for the same employer – therefore if the person you are furloughing:
- Has another substantive role with your school and
- This substantive role provides a greater income then the role being furloughed and
- The person is still receiving pay for this substantive role
It may not be appropriate to furlough this employee. We are continually seeking clarification on this point.
- HMRC will check on claims being made, especially by public sector bodies and you must be able to demonstrate the considerations above
- The scheme provides for 80% of the usual salary for the employee, schools who are able to participate in the scheme must decide whether or not they will top up the wage by 20%
- You must confirm whether you have or have not continued to pay the employees who you are looking to furlough
- You need to submit your application to ScullyA@ealing.gov.uk with a copy to firstname.lastname@example.org by no later than Wednesday 20 May 2020
- We will not be able to make any further furlough application for three weeks after submitting this application.
See downloads for spreadsheet if you have staff that you feel meet the criteria for furloughing, template letter for staff being furloughed and general guidance on furloughing.