In view of the forthcoming changes to the Coronavirus Job Retention Scheme, permitting employees to work on a part-time basis during furlough, Make UK has prepared a template letter for employers to use when seeking employees’ agreement to go onto so-called ‘flexible furlough’.
Last updated: 17.06.2020
The concept of furlough was first announced by the Government via the Coronavirus Job Retention Scheme (the ‘Scheme’) in March 2020. Employees furloughed under the Scheme remained employed but could not perform any work for their employer. They were entitled to receive 80% of their regular pay, up to a cap of £2,500 per month, which employers could claim from the Government together with employer National Insurance Contributions and the minimum level of employer automatic enrolment pension contributions on the furlough pay. Employers could choose to fund the difference between the 80% / £2,500 payment and an employee’s full salary, but there was no requirement to do so.
The Scheme was initially intended to run for at least 3 months from 1 March, but was extended twice – first to the end of June and later for a further period from July to the end of October. When announcing this further extension, the Government also announced that there would be adjustments to the Scheme during the July to October period to allow new flexibility and to gradually reduce the level of financial support provided by the Government. The key changes are:
- The Scheme will be closed to new entrants from 30 June 2020. Claims from July onwards will be restricted to employees who had previously been on furlough for at least a three week period under the Scheme in its original form, at any time between 1 March and 30 June 2020. The last date on which an employee could be furloughed for the first time under the Scheme in its original form was 10 June. (There are exceptions for employees who have been absent on statutory family leave, who transferred to a new employer under TUPE after 10 June, or who are armed forces reservists returning to their job after a period of active service);
- from 1 July, employees will be permitted to carry out work for their employer on a part-time basis during furlough, with the employer responsible for paying them for their working time, and furlough pay only being available in respect of the non-working hours of their normal working week/pattern – this is referred to as ‘flexible furlough’; and
- the amount of financial support to be provided by the Government to employers will gradually reduce from August, meaning employers will need to begin to fund part of the employees’ furlough pay.
The Government hopes that these adjustments will help to get employees back to work and boost the economy. We consider their implications in detail in our FAQs on Furlough under the Revised Coronavirus Job Retention Scheme.
You may decide the hours and shift patterns you wish furloughed employees to work during any period of flexible furlough, but such arrangements involve contractual changes and the Government guidance specifies that they need to be agreed and confirmed in writing in order for you to claim furlough pay in respect of the employee’s furloughed hours.
Our Flexible Furlough Letter Template is designed to enable you to agree with an employee, that they will go on flexible furlough. It can be used both for employees who are currently on full furlough and for those who have previously been on furlough but are currently working.