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Article:

Coronavirus Job Retention Scheme update – part time working

15 June 2020

This article covers the information available up to 12 June 2020.

Extension

On 29 May, the Chancellor confirmed the Coronavirus Job Retention Scheme (CJRS) will be extended from the end of July to the end of October 2020. The rate of subsidy will continue at 80% for August but reduce to 70% for September and 60% for October. Employers will also have to pay employer’s NIC and pension contributions on the furloughed salary of each worker from 1 August.

Part time working

As part of the announcement the Government confirmed that employees furloughed under the scheme will be allowed to resume part time work under the scheme from 1 July 2020. Where an employee resumes duties, the employer must pay normal wage rates for the hours worked and can claim furlough payments for the hours not worked based on the individual’s contracted hours or normal hours (ie average hours worked in 2019/20 or actual hours worked in the same period in 2019/20). For this reason, it is suggested that claims for employees working part time are made in arrears to avoid errors that have to be corrected subsequently. However, as with the original scheme, only one claim can be made for a specific period.

Remember that employees on furlough are permitted to continue/undertake some training under the existing scheme rules.  

The new flexible furlough scheme will replace the existing scheme which will shut down from 30 June. With the exception of employees returning from maternity or paternity leave, no employees can be added to the furlough scheme after 30 June. However, provided an employee was furloughed for any consecutive three week period between 1 March and 30 June 2020, they can enter the flexible scheme (ie they do not need to have been on furlough on 30 June).   

As the terms of the new flexible scheme change each month (see table), claims must be made for days within each specific month but claim need no longer be for three weeks at a time. For example, claims made for the period 22 June to 2 August could be made as follows:

22 June to 30 June     - final claim under initial scheme
1 July to 22 July

    - flexible scheme July claim 1

23 Jul to 31 July     - flexible scheme July claim 2
1 to 2 August       - flexible scheme August claim 1

 


 

 

 

However, HMRC says that under the flexible scheme, claims that do not cross a month end should be for at least 7 days and include all employees (ie those fully furloughed and those working part time).

Errors in CJRS claims

CJRS claims are not always straightforward to calculate: for example they can be particularly complex where an employer has a salary sacrifice for pension contributions scheme in place – read more. If you are struggling with the calculation please see details of our calculation support service.

HMRC has made clear that if you identify that you have made an error in a CJRS claim for a previous period, this should not be corrected by making an adjustment (ie deliberately under/over claiming) in a claim for a later period: HMRC says this could result in delayed payments.

Until 5 June, HMRC guidance stated that if you identify that you have made an error in a CJRS claim for a previous period, this should not be corrected by making an adjustment (ie deliberately under/over claiming) in a claim for a later period. However, the online claim procedure now includes boxes to notify HMRC about past errors in furlough claims: the amount over-claimed must be declared and the current claim reduced by that amount.    

Where an employer is no longer making CJRS claims, HMRC is working on a process to allow employers to notify HMRC about errors and pay back any over-claimed amounts. .

Remember that all records supporting CJRS claims must be maintained for six years as HMRC may later make enquiries where it appears that incorrect claims have not been rectified. It is expected that this will be part of a wide facility for HMRC to claw back overpaid Covid-19 support payments – read more. 

It is also important to remember that only one CJRS claim should be submitted per period each claim, they should include all furloughed employees paid during that period: employers cannot submit CJRS claims for overlapping periods.

Employer Essentials Index