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COVID-19: Updated Guidance on the Government Coronavirus Job Retention Scheme

04 April 2020

Frequently Asked Questions

Q1 Can an employee start a new job when on furlough?

In an update to the Coronavirus Job Retention Scheme HMRC has clarified that employees can start a new job when on furlough, meaning they might earn 80% of the old salary and 100% of a new one. The guidance does say it has to be allowed under the old employment contract, but presumably the old employer can waive that.

Q2 Can an employer reclaim 80% of compulsory commission back from HMRC, as well as basic salary?

Yes, employers can reclaim 80% of compulsory contractual commission from past sales back from HMRC, as well as basic salary.

Q3 Can an employer reclaim 80% of fees?

Yes, employers can reclaim 80% of fees from HMRC.

Q4 Does 80% include non-monetary benefits?

No. The 80% does not include non-monetary benefits (e.g. the value of health insurance or car allowance).

Q5 Can company directors be furloughed?

Yes. Although we knew this already, it has been confirmed that company directors can be furloughed. They can still perform their statutory duties, but not other work for the company.

Q6 Can employees be furloughed multiple times?

Yes. It has now been confirmed that employees can be furloughed multiple times, i.e. they can be furloughed, brought back to work, then re-furloughed (subject to each furlough period being at least three weeks).

Q7 Must employers notify employees of their furlough status in writing?

Yes, and this is new. Employers must notify employees of their furlough status in writing (the previous guidance did not require it be in writing) and keep the record of that written notification for 5 years.

Q8 Are employees who TUPE into a business after 28 February covered?

No. Leading commentators’ belief is that they are not covered. The new employer (transferee) cannot claim 80% of the employees’ salary from HMRC. TUPE transfers continuity of employment and not furlough leave.

Q9 Can employees take annual leave during furlough leave and does it break furlough leave?

The Guidance is still unclear and there is no consensus on this issue among leading commentators, but ACAS has on 06 April 2020 updated its guidance to say that employees can take annual leave whilst on furlough leave.

Q10 Can employers defer payments to employees if there are cash flow problems?

Yes, they can.

Q11 What are the terms and conditions during furlough leave?

All statutory and contractual employment rights will continue during furlough leave.

For more information or questions about employment law please contact Irina Polyakova or Lewis Holroyd on 01484 821 300.