Furlough and JSS changes: What to tell your staff?
On Saturday the Government announced a new national lockdown in England from Thursday 5th November to Wednesday 2nd December. The Job Retention Scheme (furlough scheme) which had been due to end on 31st October, was at the last minute extended for a further month and the new Job Support Scheme has been postponed.
Many businesses had been carefully managing the end of the JRS, return to work, redundancies or the implementation of the JSS – all of which has now been disrupted by the announcement.
This article is intended to summarise and help businesses to discuss the changes with staff and how agreements can be put in place with staff.
The Government has provided initial information in this link here, further detail has been promised shortly.
Can staff who were furloughed or flexibly furloughed be put back onto furlough?
Yes with their agreement. The JRS has been extended for a further month and will operate as the previous scheme did, but with the levels of support that were in place in August.
You can agree with staff to fully furlough them so that they do not work at all, or alternatively you can flexibly furlough them so that they provide some work and their remaining working hours will be furloughed.
For the time spent on furlough, the Government will pay 80% of wages up to a cap of £2,500 and employers will need to pay employer NICs and pension contributions only. If staff are flexibly furloughed then you must pay them in full for the hours that they work and claim the furlough grant for the hours which they are furloughed.
There is no requirement for staff or businesses to have previously been furloughed so this can apply to those who weren’t previously furloughed if needed.
In order to be eligible, employees must have been on an employer’s payroll by 23:59 on 30th October 2020 and a Real Time Information submission must have been made on or before 30th October 2020.
What do I tell those who were due to start the JSS?
Some staff were ready to commence the new JSS scheme this week. This scheme has been temporarily postponed until the end of the extended furlough period.
Staff cannot therefore commence this scheme and you must agree that they are either:
- flexibly furloughed – which is more similar to the JSS scheme and could mirror the arrangement you have already agreed with them; or
- fully furloughed – if your business is going to be closed or significantly affected by the second lockdown then full furlough may be more appropriate for the business; or
- staff can return to work to their usual full hours and pay with no financial assistance claimed.
If you agree with staff to furlough them, you can also decide to top up their wages above the scheme grant at your own expense if you wish. There is however no requirement to do so.
I’m in the middle of a redundancy consultation or restructure, what do I do?
You should take the extended furlough scheme into account, but this does not prevent you from proceeding with the consultation process and dismissing staff as redundant if this is fair and applicable in the circumstances.
You must consider whether or not roles can be saved using the extended furlough scheme. However a business may be able to justify continuing with redundancies as the extension is only in place for a further month and given the second lockdown, the ongoing viability of these roles may not have changed.
I made staff redundant in the lead up to the end of the furlough scheme, do I have to rehire them?
No, there is no requirement to do so. You may decide to do so and furlough these roles, but take advice before re-hiring them, as there could be risks arising in relation to repeat dismissals in future.
Further detail is expected to be announced shortly and we will update you as soon as we know more.