Advice for you – and your clients – on changes to the CJRS
The Coronavirus Job Retention Scheme (CJRS) was announced on 20 March 2020 and has supported employers in paying their employees during the Covid-19 pandemic.
From 1 July, the level of the grant will be reduced, but employers will be obliged to top up employees’ wages to 80% of their normal salary.
From 1 July, CJRS covers 70% of an employee’s wages (cap: £2,187.50) and employers will pay NICs and pension contributions and must cover the 10% not covered by the scheme.
From 1 August until the end of September, CJRS covers 60% of an employee’s wages (cap: £1,875) and employers will pay NICs and pension contributions and must cover the 20% not covered by the scheme.
The table in our Covid hub guidance for CJRS shows the level of government contribution available in the coming months, the required employer contribution and the amount that the employee receives per month where the employee is furloughed 100% of the time.
Wage caps are proportional to the hours not worked.
You can continue to choose to top up your employees’ wages above the 80% total and £2,500 cap for the hours not worked at your own expense.
So if I want to bring my employees back, what are my obligations as an employer?
As an employer, you must protect your employees from harm. This includes taking reasonable steps to protect your workers and others from coronavirus. In order to do this properly, you have to carry out a risk assessment including:
The main elements involve facilitating social distancing and providing adequate handwashing facilities. Communicating with employees will be useful in deciding on the most practical measures going forward.
The current guidance is that employees should carry on working from home if they are able to do so.
There is no obligation on the employer to keep employees on furlough and so if they refuse to go to work when asked, the logical conclusion is that they do not have any entitlement to be paid. Under employment law, workers can refuse to come into work if they believe they will face ‘serious and imminent’ danger although it is unclear whether the risk of catching coronavirus would fall under this umbrella; as the pandemic is unprecedented, no court cases have been carried out on the matter and it is unlikely that any claims to do with coronavirus will come before the courts in the immediate future.
What if one of my workers is clinically vulnerable?
Shielding is currently paused. Although the advice to shield has ended, clinically extremely vulnerable people must continue to follow the rules that are in place for everyone. Regular reviews of the risk assessment should be carried out to make sure you are doing all as ‘reasonably practical’ to keep them from harm.
Sensible employers will take into account specific vulnerabilities when deciding which employee should come back from furlough first.
Yes, you can, but employees still maintain their rights on redundancy. This means they could still be entitled to:
Redundancy pay
If an employee worked for you for two years or more, they are entitled to redundancy pay. This two-year period includes any period spent furloughed. Redundancy pay is calculated using the amount of salary pre-furlough.
Notice pay
You must give your employee notice before being made redundant as long as they have worked for you for one month. This will either be statutory notice (one week’s pay for each year of continuous employment) or contractual (the amount given on top of the statutory amount).
If the employee is only entitled to the statutory notice: notice pay should be based on full salary.
If the employee’s contract gives them at least one week more than the statutory notice period: notice pay will depend on the furlough agreement between employer and employee; eg if the employee agreed to receive 80% of pay while on furlough, and they remain on furlough for the entire notice period, then the notice pay will be paid at the same rate as the furlough pay (80%).
Holiday pay (accrued annual leave)
Any holiday pay will also be given for days accrued but not taken; this must be paid at the full rate, and not 80%, even if the employee has been on furlough. Unpaid wages, however, operate differently: if the employee was on furlough but has not yet been paid, the employee is still entitled to be paid, but only at the 80%.
ACCA has produced a suite of employment factsheets that addresses among other things redundancy, settlement offers and unlawful discrimination.