The Coronavirus Job Retention Scheme: Frequently Asked Questions
On Thursday 23rd April 2020, HM Revenue and Customs updated its guidance directed to both employers and employees on the Coronavirus Job Retention Scheme. If you are an employer claiming through the CJRS or an employee on furlough, please see our FAQs if you have any queries.
I am an employer:
I am claiming under the scheme. How and when do I need to report payments to employees?
You must report payments to employees to HMRC via the PAYE Real Time Information through your payroll software program. This should be done on or before the date your employees are paid.
If you are utilising the grant to pay the salaries of furloughed staff, any grant paid to you must be used to pay these employees, which will be subject to all payroll deductions. Equally, you should pay employees on the payment date stipulated in their employment contracts, so employees receiving Universal Credit are not affected.
If you are utilising the grant to compensate for payments already paid to employees on furloughed leave, you are not required to make another Full Payment Submission for this before receiving any payments from the scheme. This is already reported via your payroll.
I have already claimed through the scheme. What do I need to do now?
Once you have claimed, you will receive a reference number. If all is correct and approved by HMRC, the amount will be paid to you via BACS transfer within 6 working days.
It is mandatory that you keep a copy of all records associated with your claim. This includes i) the claim reference number you receive upon claiming; ii) the amount claimed and the claim period per employee and iii) your own individual calculations on your claim should HMRC require further information.
You must also pay your employees’ wages and inform your employees that you have claimed, and no further action is required.
I am an employee:
My employer wants me to go on furlough and I do not want to. What can I do?
If you do not agree with your employer to go on furlough, then you may be at risk of being made redundant or your employment being terminated effectively. However, this must comply with normal redundancy rules and protections.
I have been furloughed. What happens to my holiday pay?
You will still accrue leave in accordance with the terms of your employment contract and still take holiday on furlough. Your employer is required to pay you in accordance your ‘usual holiday pay’ in line with the Working Time Regulations (WTR).
You can opt to make an agreement with your employer to vary your holiday pay entitlement. However, most workers qualify for a minimum 5.6 weeks of statutory paid annual leave.
If you typically work bank holidays, then this can be included in the grant payment. If not, then your employer can either top up your pay to normal holiday pay or give you another day of holiday.
If you are an employee or employee in a specific set of circumstances or in a different situation and you require further information, please contact a legal professional at Hudson McKenzie via email at firstname.lastname@example.org or by telephone +44 (0)20 3318 5799.