Covid-19: The Coronavirus Job Retention Scheme (Furlough)

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Check Answer Updated over a month ago Which businesses are eligible for reimbursement under the scheme?

The scheme is open to an employer who:

  1. Furloughed employees for at least three consecutive weeks between 1 March and 30 June 2020.
  2. Has a UK PAYE payroll scheme that was registered on HMRC's real time information (RTI) system for PAYE on or before 19 March 2020.
  3. Has enrolled for PAYE online.
  4. Has a UK bank account.
Check Answer Updated over a month ago Our business has not previously furloughed staff. Can we do so now?

In the majority of cases, no. The last day on which an employee could be furloughed for the first time under the scheme was 10 June 2020.

There are some exceptions to this including where the employee was on a long period of statutory family leave at 10 June 2020 or, in some circumstances, where they were inherited through a TUPE transfer. If this applies to you, please contact us for advice.

Check Answer Updated over a month ago We have an employee who is not currently on furlough, but who has been furloughed previously. Can I re-furlough them (whether part-time or full-time)?

Yes. Providing an employee has been furloughed for three consecutive weeks at some point between 1 March and 30 June 2020, they can be re-furloughed. You can furlough an employee full-time or part-time in these circumstances, though note that part-time furlough is only possible from 1 July 2020.

Check Answer Updated over a month ago Can an employee request to be furloughed?

Yes, however they cannot insist on this. It is for the employer and employee to agree if the employee will be furloughed, whether full-time or part-time.

Check Answer Updated over a month ago Can I rotate staff on furlough?

Yes, this is permissible. After 1 July 2020, rotations can be at shorter intervals than the previous minimum of three weeks under the original scheme.

Check Answer Updated over a month ago Is there a maximum number of employees we can have on furlough?

Yes, the number of employees that you can claim for in any claim period cannot exceed the maximum number you have claimed for under any previous claim. For example, if you claimed for 30 furloughed employees in March 2020, 40 furloughed employees in April 2020 and 10 furloughed employees in May 2020, the maximum number of employees that you can claim for would be 40 employees.

There are special rules for calculating the maximum number of employees who can be furloughed where there are employees newly furloughed following statutory family leave or inherited by an employer through a TUPE transfer after 30 June 2020. Please contact us for advice if this applies to you.

Check Answer Updated over a month ago Is there a minimum period of furlough?

Under the initial version of the scheme, an employee had to remain on furlough for a minimum period of three consecutive weeks. From 1 July 2020, however, there is no minimum period of furlough.

Claim periods, however, will need to be a minimum of a week, and claim periods will no longer be able to overlap months.

Check Answer Updated over a month ago Can an employee remain on furlough full-time after 1 July 2020?

Yes. Flexible furlough is simply an option available to those employers who might wish staff to return to work part-time. If this isn’t an option, an employee can remain on full-time furlough after 1 July.

Check Answer Updated over a month ago Can I bring a furloughed employee back to work and then ‘re-furlough’ them?

Yes, employees may be furloughed multiple times. An employee can be brought back to work full-time or on a flexible working pattern from 1 July and be re-furloughed thereafter.

Check Answer Updated over a month ago For an employee on flexible furlough, is it necessary for them to work a particular number of hours?

No. The flexible furlough arrangements are intended to give employers flexibility regarding the hours worked. You will, however, need to agree any hours to be worked with employees.

Check Answer Updated over a month ago How do we agree the part-time working hours with the employee?

This should be done in writing. Where an employee has previously been furloughed full-time, you will need to enter into a revised flexible furlough agreement with them.

Just Employment Law has provided retained clients with a template flexible furlough agreement. Please let us know if you require further support with this.

Check Answer Updated over a month ago What if an employee doesn’t agree to flexible furlough?

If an employee doesn’t agree to flexible furlough, the employer will need to consider alternative options. In these circumstances, it may be that the employee can remain on full-time furlough or be re-furloughed full-time if they have previously returned to work.

If the employer requires the employee to come back to work, however, the employer may decide to take the employee off furlough altogether. An employee who is no longer furloughed would be required to attend work as normal. An employee not attending work in those circumstances may require to take unpaid leave. Please discuss this with us if you require further support with such matters. Great care should be taken before ending an employee’s furlough if the employee is refusing to return to work for either health & safety or childcare reasons.

Check Answer Updated over a month ago Employees could previously carry out training when on furlough. Can they still do this after 1 July 2020?

Yes, furloughed employees can engage in training during hours which are recorded as non-working furlough, as long as undertaking the training does not involve providing services to, or generating revenue for, or on behalf of their organisation or a linked or associated organisation.

Check Answer Updated over a month ago What work can an employee do during flexible furlough?

The work that the employee does during flexible furlough, on their working days, would generally be in accordance with the duties they can be asked to carry out as per their contract of employment. Should you wish the employee to carry out any other duties, this would need to be agreed with them.

Check Answer Updated over a month ago What pay will a furloughed employee be due to receive after 1 July 2020?

This will depend on the terms of the furlough agreement/flexible furlough agreement with the employee.

Employers may have committed to top up payments to furloughed employees and, in the absence of agreeing revised terms in respect of pay, furloughed employees should continue to receive such payments.

Should you wish to reduce the level of payments to a furloughed employee, and subject always to the employee receiving all pay that may be reimbursed by HMRC, this can be done with their agreement.

For hours worked by the employee when on flexible furlough, they must be paid their normal contracted pay. This could take into account a previous temporary wage reduction, agreed with an employee.

Check Answer Updated over a month ago What reimbursement will we receive in respect of a furloughed employee after 1 July 2020?

Between 1 and 31 July 2020, you can claim 80% of an employee’s gross pay up to a maximum reimbursement of £2,500 per month per employee. In addition, you can claim back your employer’s national insurance contributions and the minimum employer auto-enrolment pension contributions based on the furlough pay.

Between 1 and 31 August 2020, reimbursement will be as above, with the exception that it will no longer be possible to claim back the employer’s national insurance contributions or the minimum employer auto-enrolment pension contributions.

Between 1 and 30 September 2020, you can claim 70% of an employee’s gross pay up to a maximum reimbursement of £2,187.50 per month per employee. Employers will be required to pay 10% of employees' pay, capped at £312.50 per month.

Between 1 and 31 October 2020, you can claim 60% of an employee’s gross pay up to a maximum reimbursement of £1,875 per month per employee. Employers will be required to pay 20% of employees' pay, capped at £625 per month.

In all cases, the reimbursement will depend on the number of hours spent on furlough. For example, if an employee receives the maximum furlough payment of £2,500 per month and returns to work on 50% of their usual contracted hours, the amount that can be reclaimed in respect of them will be 50% of the furlough payment (i.e., 50% of £1,250). The employee would also be entitled to be paid as normal for the 50% of hours worked.

Check Answer Updated over a month ago Does a furloughed employee still pay tax on their earnings?

Yes, and deductions should therefore continue to be made as normal.

Check Answer Updated over a month ago Can a furloughed employee take annual leave during their furlough period?

Yes. However, whether you are topping up the furlough payments to the employee or not, they should receive their normal holiday pay for any period of annual leave.

Check Answer Updated over a month ago Can I require an employee to take annual leave during furlough?

This is a question that will ultimately have to be settled by the employment tribunals and appeal courts. The crux of the question is whether an employee who is required to take holidays during furlough when they do not wish to do so, is getting the “benefit” of annual leave. There may be some force in the argument that during “lockdown”, there is very little an employee can do to differentiate a period of holiday from the remainder of their time on furlough, particularly when going on holiday somewhere is not an option. As lockdown restrictions are eased, the strength of this argument may weaken.

Employers do have a legitimate interest in ensuring that excessive amounts of annual leave do not have to be taken in a short time by all employees towards the end of the holiday year, although a recent emergency amendment to the law allows holidays to be carried over for up to two holiday years and therefore somewhat addresses this point.

Ultimately, we recommend that a cautious approach is taken. If you do impose a period of holiday on your furloughed staff, you should try to ensure that during the current holiday year, there is still a reasonable amount of annual leave available to each employee, to be taken at times of their choosing once “lockdown” is over.

Check Answer Updated over a month ago What if an employee is furloughed during their probationary period? Should I extend their probation?

You are not obliged to do so, but this would be sensible. This should be communicated to the employee prior to the date on which their probationary period is due to end. Make sure first that you do have the contractual right to extend probation.

Check Answer Updated over a month ago What if an employee becomes sick whilst on furlough?

An employee who has a contractual entitlement to company sick pay and who becomes sick whilst on furlough may prefer to be placed onto sick leave, so to receive company sick pay, if this is more generous than furlough pay. This would require them to report their sickness to you.

Having said this, while on furlough, an employee is not eligible for SSP. On that basis, there is no legal reason why an employee would have to make you aware that they are unfit for work during furlough. Therefore, if an employee does not have an enhanced sick pay entitlement and becomes sick whilst on furlough, it is probably not in their interests to tell you they are sick. Employers may therefore wish to take a view on whether furloughed employees require to notify them if they become sick whilst on furlough.

An employee on flexible furlough who became sick may be eligible for SSP in respect of “working” days not worked due to sickness and furlough pay for days not worked due to furlough.

Check Answer Updated over a month ago If an employee is working their notice period, can they be furloughed?

In general, yes, subject always to the employee being paid in full for their statutory minimum notice period.

There may be limited circumstances which could be considered an abuse of the scheme by HMRC, so if you plan to ask a significant number of employees to spend their notice periods on furlough, it is advisable to discuss the circumstances with us before proceeding.

Check Answer Updated over a month ago Can an employee on furlough (whether flexible or full-time) be made redundant?

Yes, and involving an employee in consultation whilst on furlough would not be considered to be work preventing the employer from claiming reimbursement under the scheme.

An employee’s redundancy rights will not be affected by being furloughed, however, the guidance makes clear that an employer cannot claim reimbursement of redundancy payments under the scheme.

Employers should ensure that they do not use the fact that an employee has been furloughed as part of the selection criteria for redundancy. An objective redundancy selection matrix should be used, disregarding the fact that an employee was furloughed and adjusting to reflect the period of time an employee has been furloughed and not working.

There is no simple “yes” or “no” answer to the question of whether an employment tribunal would find a redundancy dismissal during furlough to be unfair. Much will depend on the timing of the redundancy and the financial position of the business.

For example, it could theoretically be unfair to dismiss an employee by reason of redundancy where there is no cost at all to the employer in keeping the employee on furlough. Employers might therefore need to consider whether it would be reasonable to keep individuals in employment until 31 July 2020 before making them redundant, since the furlough scheme may be viewed as a viable alternative to dismissal until that date.

We are not suggesting there is any sort of rule that it will be unfair to dismiss a furloughed employee by reason of redundancy prior to 31 July 2020. Rather, the question of allowing the employee to remain in employment for a short period, to benefit from the furlough scheme, is one that an employer should demonstrate it has at least considered.

From 1 August 2020, the position will be different, as employers will have to start contributing to wage costs under the furlough scheme. The question of the appropriate timing of dismissal should still be consulted upon with affected employees and we would encourage you to discuss any proposed dismissals with Just Employment Law in advance in order that we can provide appropriate advice.

Check Answer Updated over a month ago How do I make a claim to HMRC?

Claims can be made via the following link.

Any claim made under the current scheme (which ends on 30 June 2020) must be made by 31 July 2020.

For claims in respect of 1 July 2020 onwards, employers will need to report both actual hours worked during flexible furlough and the usual hours an employee would be expected to work in a claim period.

HMRC will retain the right to retrospectively audit all aspects of your claim. You may wish to speak to your accountant to confirm whether they can process the claim for you.

Check Answer Updated over a month ago What records should we keep and for how long?

Employers should keep copies of all furlough agreements entered into, as well as documentation in support of all furlough claims.

There is conflicting information on the period of time for which records should be kept, however, with the claim guidance suggesting records should be kept for six years, whilst the employers’ CJRS guidance suggests records should be kept for five years. In these circumstances, it would be sensible to retain records for six years.

Check Answer Updated over a month ago Can a furloughed employee work elsewhere?

Yes, this is permitted by the scheme rules, provided the employee is not working for an associated employer. This is permitted whether an employee is furloughed full-time or flexibly. You should clarify if you want employees to get permission from you before starting another job while furloughed, and it would be reasonable to reserve the power to say no if the job would conflict with the interests of your own business.

Check Answer Updated over a month ago Can I employ an individual who has been furloughed?

Yes, this is permitted, however you should ensure that you complete the PAYE starter checklist form correctly. If an employee is furloughed from another employment, you should complete Statement C.

To download full document Coronavirus (Furlough).


 The information was accurate as at 26 June 2020 when this resource was written by our team of employment solicitors.


The information provided in this document is intended as general guidance only. The information is not intended to constitute legal or other professional advice and should not be relied on or treated as a substitute for specific advice relevant to particular circumstances. Just Employment Law Ltd shall accept no responsibility for any loss which may arise from reliance on the information in this document.

Just Employment Law Ltd retains copyright in this document and it may not be reproduced or shared. Permission must be sought from, and granted by, Just Employment Law Ltd before this material may be used for any other purpose.

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