CJRS Extended and National Lockdown
Updated 23rd December 2020
Boris Johnson announced on Saturday 31st October that the Coronavirus Job Retention Scheme (CJRS), set to end on that day, would be extended. The Job Support Scheme (and the Job Retention Bonuses) has been postponed until the CJRS ends. The CJRS will now remain open until 31 March 2021.
Under the extended CJRS, the position for employers is the same as it was back in August. This means that the Government will reimburse the employer for 80% of furloughed employees salaries for the hours not worked by them, up to a maximum of £2,500 per month (back up from the position in October whereby the Government was contributing 60% up to a maximum of £1,875 per month). Employers will only be required to cover employer National Insurance and pension contributions for hours not worked by the employee. The Government has confirmed that this will be the case until 31 March 2021.
Employees that were on the payroll on 23 September 2020 who have stopped working for their employer since that date, can be re-employed and claimed for. Retrospective agreements can be put into place backdating furlough but only until 13 November 2020 – this is the cut-off date to do so. Also, employees who have joined the employer since 19th March and have not previously been furloughed, are now eligible to be furloughed. Any claims must be for a minimum period of seven consecutive days.
Employees cannot be served with notice of termination of their employment (for redundancy or otherwise) during the period in which the employer is claiming under the CJRS. This rule applied from 1 December 2020. The scheme also cannot be used to substitute redundancy payments, as has always been the case.
Contrary to some reports in the media, it is important employers should still obtain the employee’s written agreement to be placed on furlough as they have previously. The written record should be kept for 5 years.
The CJRS will continue to be available for both full-time furlough and flexi-furlough and there is currently no firm guidance on how much notice is required to request employees to return to work; it is suggested that 48 hours is deemed reasonable.
What about the minimum wage?
As employees will technically not be working during the time that they are on furlough, it does not matter if their earnings dip below the national minimum wage threshold.
What about annual leave?
It is important to remember that employees will continue to accrue annual leave whilst they are on furlough as they have done for the whole period of time that they have been on furlough. Employers therefore may wish to consider asking or requiring employees to take annual leave whilst on furlough (preferably having this in the written furlough agreement). This will avoid employees returning to work with a lot of leave that they won’t have the opportunity to take before the end of the holiday year and will otherwise carry over. It will also avoid having to pay for accrued but untaken holiday where redundancies become necessary.
If agreement cannot be reached, employers are entitled to request that employees take annual leave so long as they give two times the length of the leave as notice. For example, if the employer is requesting that employees take one weeks’ leave, they will need to provide two weeks’ notice. If employees take annual leave whilst on furlough, their pay must be topped up to 100% by the employer; however, 80% of that can be reclaimed from the Government (up to £2500).
Back in March, the Government announced that workers who have not taken all of their statutory annual leave as a result of the pandemic will be able to carry over up to four weeks for up to two years. It is therefore best to seek agreement with employees regarding the carry over annual leave and to ensure that all employees are treated consistently in this regard.
National lockdown from 5th November – what is the latest position on working from home?
There has been some confusion surrounding the issue of whether employees must work from home during the national lockdown commencing on 5th November 2020; or, whether employers are still able to require employees to attend the workplace. This confusion seems to have been caused by the fact the most recent legislation and the online guidance doesn’t quite match up.
The Health Protection Regulations state that a person may leave their house “for the purposes of work or to provide voluntary or charitable services, where it is not reasonably possible for P [them] to work, or to provide those services, from home”. It is our view this would indicate that if a person has the ability to work from home then they should.
However, the Government’s guidance which it would appear most companies and HR professionals are using as a ‘go to’ states: “to help contain the virus, everyone who can work effectively from home must do so.” Some employers therefore appear to be reading this as: if an employee cannot work as effectively at home as they do in the office then they should still come into the office or workplace.
It is our position that it is the Regulations that employers should be following (as this is the law) and therefore if an employee can work from home, they should do so during the national lockdown.
We will keep the above under review as new developments and guidance impact on the situation. If we can assist further with any of the matters raised above, or, alternatively, any matters we haven’t covered, please do get in touch with a member of our team and we’d be happy to help.