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CJRS - Frequently Asked Questions

How should I split the payroll records for each staff member for the JRS claim when they were furloughed mid payroll period? 

Clients may set up a new payment on payroll system called retention payment and process JRS payments through this.  If employer is topping up extra 20%, put this amount through ordinary basic payment line.

Keeping the records separate will make the claims a lot easier.

HMRC have confirmed that the 80% adjustment must be made prior to the claim being submitted.

When will the scheme open?

HMRC have advised that the scheme will open on 20^th April 2020.

If your employee is on unpaid leave can they be furloughed?

Employees on unpaid leave cannot be furloughed, unless they were placed on unpaid leave after 28 February.

Do furloughed staff continue to accrue holidays while they are furloughed?

Yes, this was not in the original guidance but has since been confirmed by HMRC.

Do staff have the same number of day’s annual leave to take when they return to work?

Annual leave accrues as normal; however, regulations are being amended to allow workers in Northern Ireland who are unable to take holiday leave as a result of the COVID-19 outbreak to carry over their annual leave to the next two leave years.

Can furloughed staff take annual leave while furloughed?

Guidance is unclear on whether employees can elect to take holiday or be required to take holiday during furlough.  This is something that we expect clarification on soon.

HMRC has confirmed (on 8 April 2020) that furloughed employees can take their bank holidays as usual over the Easter period and a claim can still be made on the CJRS in this respect.

HMRC have confirmed that employees must be paid 100% of their wage for holidays while furloughed but there is still a lot of uncertainty on whether 80% can be claimed back via JRS and how it will impact the minimum three-week furlough period.

This is one of the least clear areas within the scheme and caution should be exercised. 

What if a staff member needs to come in to carry out their role for a particular task?

Staff members can be furloughed more than once, however the minimum period must be for 3 weeks.  E.g. is a person needs to run the payroll once a month, they could be potentially furloughed for three weeks, run the payroll and then be furloughed again.

This is my employee’s second job – can I furlough him if he has been furloughed in his main job?

Yes, provided that the employee was on both payrolls at 19^th March 2020.

You can be put on furlough by one employer and continue to work for another, if it is permitted within your employment contract.

My employee is off due to underlying health conditions, can I furlough this employee or should I pay SSP instead?

SSP should be paid were an employee is self-isolating but only for two weeks, after which, medical evidence would need to be provided for further SSP payments.

An employee who is shielding in line with recommendation from PHA or who is on long-term sick leave can be furloughed however it is up to the employer to decide whether to furlough the employee.

Evidence of letter received stating that they should shield should be retained for records.

Can an employer furlough someone that started in March but hasn’t been paid yet?

Employers can claim for furloughed employees that were on their PAYE payroll on or before 19 March 2020 and who were notified to HMRC on an RTI submission on or before 19 March 2020.

Pregnant employee isolating at home on own initiative as deemed to be in vulnerable group, what are they entitled to as work is still available?

The Coronavirus Job Retention Scheme is designed to cover 80% wages of employees who would otherwise have been laid off during the crisis – so not applicable here.

The new legislation (the Statutory Sick Pay (General) (Coronavirus Amendment) Regulations (Northern Ireland) 2020) covers people isolating themselves from other people in such a manner as to prevent infection or contamination with coronavirus disease, in accordance with government guidelines – currently the ‘stay at home guidelines’; where an employee has acted on the instruction from 111; or the employee is acting on their own initiative to self-isolate (e.g. where they have recently returned from a high-risk area but are currently asymptomatic).  In our view, the legislation does not cover employees refusing to attend work (where the work is available) because they are being cautious. 

An employee can start SMP up to 11 weeks before her due date and that HMRC already have an advance funding scheme setup for SMP should the employer need it.

If my employee is on a zero hour contract what are they entitled to?

The JRS Scheme covers zero hours contracts. 

For staff with variable pay, if the employee has been employed for a full twelve months prior to the claim, you can claim for the higher of either:

•             the same month’s earning from the previous year

•             average monthly earnings from the 2019-20 tax year

We advise employers to look at these cases on an individual basis.

If the employee has been employed for less than a year, you can claim for an average of their monthly earnings since they started work.

If I am an essential business but have chosen to close, am I still applicable for CJRS?

CJRS is designed to support employers whose operations have been severely affected by coronavirus. There is not yet a definition of “severely affected”.  The scheme was designed to protect employees who would otherwise be made redundant; however, it is not clear whether businesses which are deemed to be “essential” and who choose to close will be covered under this scheme. The guidance does however state that all UK businesses are eligible for the scheme as the UK Government appreciates that businesses will be impacted in different ways.

There are many reasons why an “essential” business could be severely impacted by COVID-19 including:

•          Reduction in sales

•          Supply chain issues

•          Health and Safety concerns

This is a grey area and as yet no clear guidance has been released.  Businesses should therefore clearly document how they have been “severely impacted” by COVID-19.

What is Emergency Volunteering Leave?

Suitably skilled and/or experienced workers will be able to take Emergency Volunteering Leave in blocks of two, three or four weeks during any sixteen-week volunteering period.

The Emergency Volunteering Leave is unpaid; however, a compensation scheme will be set up to compensate eligible emergency volunteers for some loss of income and expenses incurred.

To be eligible for this leave, employees must be certified by an appropriate authority to act as an emergency volunteer in health or social care. In Northern Ireland, the appropriate authorities are:

•      the Department of Health

•      a Regional Health and Social Care Board

•      a Health and Social Care trust

To avail of the Emergency Volunteering Leave, employees must give their employers at least three working days' notice and the certificate provided by the appropriate authority.

Except for those organisations and workers that are exempt, there is no provision for employers to refuse leave, for example because of operational need.

Clients who are owner directors and may be the only employee(s) within a company.

Will they be entitled to the 80% grant for furloughed workers?

Individuals who are directors of their own family companies and who are themselves paid via PAYE should be eligible for the coronavirus job retention scheme, the same rules will apply as to other businesses and their employees.

Can owner directors/managers who are furloughed still work to keep the company going?

Directors and owner-managers can be furloughed if on PAYE and will still be allowed to do statutory duties in these roles – this will not count as work which disqualifies them from the grant.

Statutory Duties

•          To act within his or her powers;

•          To promote the success of the company;

•          To exercise independent judgment;

•          To exercise reasonable care, skill and diligence; 

•          To avoid conflicts of interest; 

•          Not to accept benefits from third parties;

•          To declare an interest in proposed transactions or arrangements.

On 28 March 2020 the Government confirmed that the wrongful trading law would be suspended retrospectively from 1 March 2020, allowing company directors to continue to pay staff and suppliers even if there are concerns that the company could become insolvent.

Can I furlough my employees but not pay the retention payments until the scheme is open?

We do not believe so as furloughed employees have the same employment rights as pre-furlough.

If no contract is in place with employee or temporary lay-off is not set out in their contract, they have the contractual right to receive pay for temporary lay-off.  If temporary lay-off is covered in the contract and states that employee will receive no pay during lay off – then he could temporarily lay off (and pay guarantee payments) until such times as the portal opens.

Furlough can be backdated to the start of March but the employer is expected to pay the retention wages until such times as they can claim the grant.  Government have set up various grants/loans to help in the meantime in light of situations like this.

If an employee’s pay is variable but they increased their hours during the year, how do I calculate their furloughed wage?

You should take the higher of the average of the full tax year or the same month’s earnings from the previous year as per guidance.

How are an employee’s wage calculated if they are returning for statutory leave?

Statutory leave includes maternity leave, paternity leave, shared parental leave, adoption leave, sick leave and parental bereavement leave.

In line with other employees, if you are a full or part time employee returning from statutory leave, your employer should calculate the grant against your salary, before tax, not the pay you received whilst on statutory leave.

If your pay varies, and you are furloughed on your return from statutory leave your employer should calculate the grant using either the:

•      same month’s earning from the previous year

•      average monthly earnings for the 2019-2020 tax year

The guidance states employers can rehire staff that where made redundant or they stopped working for them after 28 February. What are the implications of this?

If you have paid them redundancy and notice pay, there is nothing to suggest that this can be recouped.

It you are to re-hire; normal employment law will apply and there may be future issues about redundancy post JRS and continuous service.  Also issues around what staff you rehire – could be claims of discrimination.  Take bespoke legal advice if you are intending to do this.

If I furlough staff, can they work for a linked or associated organisation?

No – the guidance does not allow this.

Can I furlough staff who are sick or in self isolation?

Short term illness/ self-isolation should not be a consideration in deciding whether to furlough an employee. If, however, employers want to furlough employees for business reasons and they are currently off sick, they are eligible to do so, as with other employees. In these cases, the employee should no longer receive sick pay and would be classified as a furloughed employee.

A staff member has become sick while on furlough, what do I pay them?

Furloughed employees retain their statutory rights, including their right to Statutory Sick Pay. This means that furloughed employees who become ill must be paid at least Statutory Sick Pay. It is up to employers to decide whether to move these employees onto Statutory Sick Pay or to keep them on furlough, at their furloughed rate.

One of my staff has someone in their household shielding and they have asked to be furloughed. What do I do?

The guidance states that Employees who are unable to work because they are shielding in line with public health guidance (or need to stay home with someone who is shielding) can be furloughed.

The public health guidance states that “if the rest of your household stringently follow advice on social distancing and minimise the risk of spreading the virus within the home by following the advice above, there is no need for them to also shield alongside you.” 

There is no guidance on what “needs to stay at home with someone that it shielding” means, however, the PHA guidance states that household members do not need to shield. 

Therefore, employers will have to document the reason why the employee “needs” to stay at home.  We would also suggest that alternatives are investigated such as working from home before agreeing to furlough a staff member. 

Always request for a copy for the formal letter stating that the person needs to shield.  A letter from their GP will not suffice.

This is an area that requires clarification so employers should not assume that they will be able to claim for all cases.

What about employees who have transferred under TUPE or a change of ownership?

A new employer is eligible to claim under the CJRS in respect of the employees of a previous business transferred after 19th March 2020 if either the TUPE or PAYE business succession rules apply to the change in ownership.

Can I rotate staff on furlough?

Yes, guidance permits this provided the furlough period is minimum of three weeks.

Is a UK company with employees in ROI but who are on UK PAYE eligible for Job Retention Scheme?

Current guidance states that the scheme is open to any entity with a UK payroll and UK bank account so they should be eligible for UK JRS – however, this has not been tested yet.

Is a UK company with employees in ROI but who are not on UK PAYE eligible for Job Retention Scheme?

Based on current guidance, it does not seem that they will be eligible as they can’t claim unless they are on a UK payroll.

Further clarification is required.

Can UK company claim for ROI citizens who are paid via a UK payroll?

Based on current guidance, it seems that they will be eligible as it stated that foreign nationals are eligible to be furloughed.

If a contractor lives in NI but works in ROI, what self-employed support is available for them?

They are not eligible for the pandemic unemployment payment in ROI as they have to be living in ROI to get it.

As they are a UK resident, they should be able to get the UK support provided they meet the conditions:

•          Have submitted an Income Tax SA return for 2018/19

•          Traded in the tax year 2019/20

•          Are trading when apply or would be except for COVID-19

•          Intend to continue to trade in 2020/21

•          Have lost trading profits due to COVID-19

•          Trading profits must be less than £50k and more than half of their income must come from self-employment.

What information do I need to submit to the online service to claim?

You’ll need to provide the following to make a claim:

•      your employer PAYE reference number

•      the number of employees being furloughed

•      National Insurance Numbers for the furloughed employees

•      Names of the furloughed employees

•      Payroll/employee number for the furloughed employees (optional)

•      your Self-Assessment Unique Taxpayer Reference or Corporation Tax Unique Taxpayer Reference or Company Registration Number

•      the claim period (start and end date)

•      amount claimed (per the minimum length of furloughing of 3 consecutive weeks)

•      your bank account number and sort code

•      your contact name

•      your phone number

If you have fewer than 100 furloughed staff you will be asked to enter details of each employee you are claiming for directly into the system.

If you have 100 or more furloughed staff you will be asked to upload a file with the information rather than input it directly into the system.

If you use an agent who is authorised to act for you for PAYE purposes, they will be able to make a claim on your behalf.

If you use a file only agent they won’t be authorised to make a claim for you and you will need to make the claim yourself.