Furlough Scheme Extended for November to March 2021

The rules for the November to March furlough scheme are very similar to the rules which were applicable throughout the previous months.

However there are some slight differences. We go through the most frequently asked questions below.

To be eligible for the extended furlough scheme, the employee must have been included on your submitted payroll. This therefore means a real time information (RTI) has been filed, which includes that employee.

The deadline date has been updated to include all employees on the RTI filings up to and including the 30th October 2020.

All organisations within the UK can claim for their employees.

The employer must have both a UK bank account and a UK registered PAYE scheme.

The extended furlough scheme is independent of the previous job retention schemes. As a result neither the employer nor employee are required to have made previous claims.

The Government will cover 80% of the employee’s wages up to a cap of £2,500. This only includes hours not worked by the employee.

The grant received must be paid to the employee in full.

Employers are required to pay the hours actually worked by the employee in the normal way.

The employer’s national insurance and pension contributions are also payable by the employer.

Yes, employers can choose to top up the employees wage if they wish. This is optional.

The Government have confirmed that there is no gap between the previous job retention scheme ending and this new scheme commencing.

Therefore, this scheme commences 1st November 2020.

The Government have announced that the furlough scheme is expected to remain in place until March 2021.

There is to be a review of the scheme in January 2021.

The portal to make the claims opened on 11th November 2020. To start a claim go to HMRC furlough scheme portal and scroll down the page to the green box stating ‘Claim now’.

Yes. The Government have included a 14 day deadline following the month in which furlough is being claimed. Therefore claims relating to days furloughed in November must be claimed by 14th December. Employees furloughed in December must be claimed by 14th January and so on. This ends on 14th April 2021 which will be the last day that March furlough can be claimed.

N.B Claims can be made on the next working day if the 14th happens to fall on a weekend.

Yes and it is to be encouraged where possible.

When flexible furlough is used, the Government will only cover the cost for hours not worked.

No, this is a requirement under the job support scheme (open rules) which has now been postponed.

Under the November furlough scheme rules an employee can have zero hours worked and still be eligible. As a result businesses required to close from 5th November will likely claim full-time furloughing for all or some of their employees.

The furlough claim is based on the employees pay at February / March 2020. Employers must use their historic pay records, which therefore ignores any pay rises in 2020/21. Therefore if the employee was furloughed under the old scheme the same calculations are used now.

Employees who commenced employment post 20th March 2020 won’t have qualified for the old furlough scheme. Their furlough calculation is based on the 2020/21 payroll records.

NOTE: Employees with equal pay and contracts could have differing furlough calculations depending on their start date. An employee who was employed in 2019/20 will use old payroll records, whereas the new employee will use the 2020/21 payroll records.

The calculations can be complex, especially if flexible furlough is adopted. We therefore, strongly recommend using the HMRC Furlough Calculator Tool.

Yes. HMRC have confirmed that every business that uses the new extended furlough scheme will be named. An indication of the amount claimed will also be made public. The assumption is that by publicly naming every company it will reduce fraudulent claims.

Claims made under the old furlough scheme will not be named publicly.

The decision to furlough an employee must be agreed in writing. As this is a brand new extended furlough scheme, we recommend that a new written agreement is put in place. HMRC can demand to see these as evidence of the claim and they are required to be retained for a minimum of 5 years.

As with anything employment related it is important to consider the employees contract. Therefore, third party employment law providers may be required to ensure compliance.