Flexible Furlough Update
The government have been talking about Flexible Furlough for a few weeks now, and we finally got the guidance last Friday. So here's my guide for you based on what we know at the moment.
What are you going on about?
From 1 July 2020, employers can bring employees back to work on a part time basis for any amount of time on any work pattern. You will still be able to claim furlough for the hours that employees do not work compared to the hours they would normally have worked.
How do I do it?
You can only furlough employees who you have previously claimed the furlough grant for. Employees must now have been furloughed for at least 3 consecutive weeks between 1 March and 30 June 2020 to be able to make use of the flexible furlough scheme.
You will need to discuss any flexible furlough arrangements with the employees before you make any changes. The working pattern and hours will need to be agreed with the employee and confirmed in writing.
You don't have to put all employees on the scheme if you don't want to and, equally, you can leave employees on full furlough if you wish.
How long can I furlough someone for?
Flexible furlough can last for any amount of time, but the minimum period you can claim for is 7 calendar days. Employees can enter into the flexible furlough scheme more than once so you can rotate employees.
What do I pay employees on flexible furlough?
You will need to pay employees for the hours they work along with their National Insurance and Pension Contributions. You can then claim furlough for the remainder of hours they do not work. Wage caps are proportionate to the hours an employee is furloughed for. So if an employee is furloughed for 60% of their usual hours, they are entitled to 60% of the £2,500 cap.
Remember that the amount the scheme will cover begins to decrease from September 2020.
You can claim from 1 July 2020 but you should not claim until you have confirmation of the exact number of hours the employee will have worked during the period you are claiming for.
What should I record?
You need to keep a record of how many hours employees work and the number of hours they are furloughed for. So if an employee normally works 37 hours a week is furloughed for 22 hours, they are working for 15 hours.
Can employees work during the "downtime" in flexible furlough?
No - but you can ask them to do training provided they are paid at least National Minimum Wage for those hours.
How do I calculate normal working hours?
If an employee is on flexible furlough, you should have a record of their hours worked and their hours furloughed.
If the employee's hours are fixed, the pay does not vary according to hours worked, therefore the reference period for calculating their hours is the hours they were contracted to at the end of the last pay period or before 19 March 2020.
You can tell if someone works variable hours or variable hours if:
the employee is not contracted to a fixed number of hours
the employee's pay is dependent on the number of hours they work
If the hours are variable, you will use the higher of:
the average number of hours worked in the tax year 2019-2020
the corresponding calendar period in the tax year 2019-2020
Things to watch out for
Ensure that you apply a fair and objective selection process to bring employees on to flexible furlough. By that, I mean think about it according to what skill sets you need and when. Don't bring Susan back on flexible furlough on the assumption that she'll want to retire soon as that may land you in a pickle where discrimination is mentioned a lot.
Equally, don't make assumptions about people's childcare situations, but definitely be aware that employees might be facing some challenges around childcare.
Remember to make sure you have all your safety measures and I would definitely advise to complete a return to work questionnaire with employees who haven't been to work recently.
Finally, remember that ANY change to working location and working hours needs to be agreed and confirmed in writing.
That's all for now folks, be sure to get in touch if you have any questions or need any support!