Coronavirus Job Retention Scheme

What is the Coronavirus Job Retention Scheme?

The Job Retention Scheme has been implemented by the government with the aim of paying the salaries of employees who would otherwise have been laid off during the  disruption caused by the COVID-19 pandemic. It allows for UK employers to claim 80% of their furloughed employees’ monthly wages, up to £2,500 a month, as well as associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that wage.


All UK businesses are eligible.

However, you must have:

  • created and started a PAYE payroll scheme on or before 28 February 2020
  • enrolled for PAYE online
  • a UK bank account
Accessing the scheme

Affected employees will need to have their status changed to ‘furloughed workers’ and be notified of their status change. Furloughed employees must have been on company PAYE payroll on 28 February 2020 as employees hired after 28 February 2020 cannot be furloughed.

Claims will need to be made through the HMRC online portal which is expected to be available by the end of April 2020, with the first claims being paid 10 days later. Using the HRMC online service employers must submit information about who has been furloughed and their earnings, including the furloughed employees:

  • National Insurance number
  • salary, National Insurance and pension contribution information that allows business to calculate the claim amount.

Claims can be backdated to 1 March 2020 and furloughed staff must receive no less than 80% of their pay, with a cap of £2,500 per month per employee. When claiming worker’s wages should be reduced to 80% of their salary within your payroll before they are paid as this adjustment will not be made by HMRC.

While your employees are on furlough, you cannot ask an employee to do any work that:

  • makes money for your organisation or any organisation linked or associated with your organisation
  • provide services for your organisation or any organisation linked or associated with your organisation.

However, they can take part in training or volunteer work.

Employers’ duties under UK health and safety law

Under the health and safety laws of the UK, employers employers should assess the levels of risk present and take sensible measures to tackle them. With the current COVID-19 pandemic, it may be a breach of those duties to knowingly allow an individual who has been advised to self-isolate, or who has shown visible symptoms on the premises or to come in contact with other employees, especially if other employees are classed as vulnerable e.g. pregnant or those with long-term health conditions.

Suspension may be an option where an individual who has been advised to self-isolate refuses to do so, but employers should consider whether they have a right to suspend in these circumstances. Where no express contractual right to do so exists, legal advice should be sought.

Working from home due to COVID-19

The Government have enforced new rules in which you must stay home, so where possible all employees must adhere to the recommendation and work from home to reduce the spread of COVID-19 to others. The COVID-19 pandemic raises points of employment law and it is essential that employers and employees are sensitive and flexible to each others’ needs.

In most instances employees should be asked to carry out their work from home using laptops or mobile phones. However, where staff are unable to work from home on laptops or mobile phones, employers should arrange paperwork tasks that can be done from home. Where it is mutually agreed that the employee should work from home, the employer should:

  • Pay the employee as usual
  • Keep in regular contact with them; and
  • Check on the employee’s health and wellbeing

Working from home can be challenging and so it is important that certain provisions are set in stone prior to its enforcement, such as agreeing:

  • How work-life balance will be managed, for example taking regular breaks
  • Rules around storing information and data protection
  • Who employees should contact in the event that they have any issues or their circumstances change

Employers need to ensure all employees working from home know exactly what is expected of them.  It is also important for employers to note that some employees find it hard to stay motivated when working from home and so managers and employees should work together to find practical solutions to such issues as they arise.

End of the Job Retention Scheme

Upon the end of the government scheme, employers must make a decision, depending on their circumstances, as to whether employees can return to their duties. It is important to note that if not, it may be necessary to consider the termination of an employee’s employment through redundancy.

Contact us if you want immigration or employment law advice in light of COVID-19, whether you are an employer or employee. You may find the following useful:

Employment rights during COVID-19

COVID-19: effects on Tier 2 employers

Immigration changes due to COVID-19

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