Updated information to the job retention scheme
17 Apr 2020
On 15 April 2020, the government issued a Statutory Direction setting out requirements for the Coronavirus Job Retention Scheme, also known as furlough leave. There are some important points to note, including two urgent points to bring to your attention.
The first is the requirement for there to be a written agreement from both employer and employee to be furloughed. This contrasts with the current online guidance, which simply says “To be eligible for the grant employers must confirm in writing to their employee confirming that they have been furloughed. A record of this communication must be kept for five years.”
Therefore, just to be sure, if you haven’t already got written agreement to be furloughed from your employees, you should seek this now. We have put together a template email that you could use – please ensure that all relevant information is inserted into this before sending it to affected employees. Download template email
The second, under the earlier guidance, employers could have placed employees on furlough and not continued to pay them until such time as HMRC paid the grant under the scheme, which would then be passed on to employees. There are obvious reasons why an employer may do this in the current circumstances and there was, and is, nothing in the online guidance to suggest this is not allowed. However, the new Direction suggests that you can only recover monies from HMRC that have already been paid – effectively the grant amounts to a reimbursement of monies paid. The requirements appear to be as follows:
- If between 1 March and 18 April there has been a period in which an employee has been furloughed and you have not paid the employee what they would get under the scheme, you will have to make up the pay they would be due under the scheme for that period BEFORE you make a claim.
- For any period after 18 April, if you have not paid an employee what they would get under the scheme while they are furloughed, you will not be able to make that pay up later and, therefore, you cannot be reimbursed by HMRC for that period. Effectively, we think this means that if you continue to not pay employees 80% of their salary (subject to the £2,500 p/m cap), you will not get money from HMRC.
For more details on any of these changes, or to discuss individual circumstances contact the NPA Employment Advisory Service (on 0330 123 0558 / email@example.com).
It’s important to also note that this Direction can be changed at any time by the government – we expect it won’t be changed before the proposed introduction of the scheme, which is due to go live on 20 April 2020.
The online claim service for the Coronavirus Job Retention Scheme will be launched on GOV.UK on Monday 20 April 2020.
Can pharmacy staff be furloughed?
Gov.uk advises that where employers who receive public funding for staff costs, and where funding is continuing, employers are to use that money to continue to pay staff in the usual fashion – and correspondingly not furlough them. This also applies to non-public sector employers who receive public funding for staff costs. Organisations who are receiving public funding specifically to provide services necessary to respond to COVID-19 are not expected to furlough staff. In addition to the requirement for the employee’s role not to be publicly funded (for which monies will not be reducing), what is clear that any furlough payments claimed must go hand in hand with a downturn in work as a result of the Covid-19 outbreak and it is assumed most pharmacies will struggle to demonstrate this and, as such, will not be eligible for the job retention scheme.
However, in a small number of cases, for example where organisations are not primarily funded by the government and whose staff cannot be redeployed to assist with the coronavirus response, the scheme may be appropriate for some staff. You should consider that if there is work available to do in a community pharmacy, and if a staff member’s role can be redeployed to assist with the coronavirus response, then furloughing is not in line with the scheme.
Some staff employed in community pharmacy, for example those whose role is to sell cosmetics, may have little or no work and may be eligible for furlough in line with the scheme. Employers should assure themselves that the revenue that supports their role is private before going through the furlough process.
We recommend any NPA members considering or implementing furloughing discuss individual circumstances with the NPA Employment Advisory Service (on 0330 123 0558 / firstname.lastname@example.org).