The Coronavirus Job Retention Scheme – fourth Government update and Treasury Direction issued

Book your free initial call

    We endeavour to make an initial response to all enquiries within 24 hours but please be aware that on some occasions due to prior commitments or volume of calls we will not be able to respond in that time frame. We also operate a 48 hour return policy. This return policy means that if we have not responded with 48 hours of your initial enquiry we are unable to do so due to current workloads and we will destroy your data accordingly. This policy ensures you are not left waiting and have the certainty that your data is not compromised. In most instances however we are able to make contact within a 24 hour time frame. Please note our free initial advice service is available to clients at our total discretion and if your case is of a complex nature we may not be able to offer you a free consultation. However in these instances we will advise you what the charge would be for an initial fixed fee consultation.
  • (view our privacy statement)
  • This field is for validation purposes and should be left unchanged.

The Treasury has issued a Direction to HMRC pursuant to its powers under the Coronavirus Act 2020 to give authority for HMRC to administer payments under the Coronavirus Job Retention Scheme. The Direction and “Schedule” which sets out the details of the Coronavirus Job Retention Scheme (“the Scheme”) are here.

It will be noted that the Scheme itself (and in turn the Guidance) has been further updated and although further amendments are possible it looks likely this will be the final version. The updated guidance is here.

There are changes and clarifications to the Scheme. Some of the key ones are:-

  1. Furloughed employees that were on an employers PAYE payroll on or before 19 March 2020 and which were notified to HMRC on an RTI submission on or before 19 March 2020 can now claim. Previously this date was 28th February 2020. Employees that were employed as of 28 February 2020 and on payroll (i.e. notified to HMRC on an RTI submission on or before 28 February) and were made redundant or stopped working for the employer after that and prior to 19 March 2020, can also qualify for the scheme if the employer re-employs them and puts them on furlough (see the Guidance and sections 3.2 and 5(a) of the Schedule).
  2. It provides that the Scheme applies to anyone furloughed “by reason of circumstances as a result of coronavirus or coronavirus disease.” (section 6.1 © of the Schedule). It is therefore NOT limited to employees who would otherwise have been made redundant. It goes much wider than this in fact.
  3. Section 6.7 of the Schedule for the Scheme states that to claim furlough, “An employee has been instructed by the employer to cease all work in relation to their employment only if the employer and employee have agreed in writing (which may be in an electronic form such as an email) that the employee will cease all work in relation to their employment.”
  4. Section 7.3 of the Schedule states that in determining an employee’s reference salary, no account is to be taken of anything which is not regular salary or wages. Sections 7.4 to 7.5 of the Schedule address this further.

There is still no guidance on holidays and holiday pay unfortunately. However, ACAS guidance recently published states, “Employees or workers who are temporarily sent home because there’s no work (‘furloughed workers’), can request and take their holiday in the usual way, if their employer agrees. This includes bank holidays. Furloughed workers must get their usual pay in full, for any holiday they take.” However, as ACAS is an independent organisation, it would have been helpful to give certainty for employers on this and hence for the Government to have addressed this in the Schedule sent to the Treasury and in turn in its Guidance.

15th April 2020
Astons Solicitors