The flexible furlough scheme explained: Croner-i offers advice

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The introduction of the flexible furlough scheme to help businesses bring staff back to work and reopen will run alongside the full furlough scheme as it closes in October. Croner-i helped businesses understand its key requirements through a webinar hosted on 23 June.

Amanda Chadwick hosted the webinar, titled furlough-proofing your business. She was supported by Croner-i Head of Legal and Advice Andrew Willis.

Winding down of furlough scheme

From the start of August, employers will be required to pay the national insurance contributions and employer’s pension contributions which comes to 5% of total wage costs in an average claim.

From September, employers will have to contribute 10% towards the 80% paid wages of furloughed employees (capped at £2,500) plus national insurance and pension contributions as before. This means the scheme funds 70% of wages, up to £2,187.50.

October will be the last month of the scheme, with employers required to be pay 20% of the 80% furlough payment (plus national insurance and pension contributions), meaning the scheme will fund 60% of wages to a cap of £1,875.

Employers will be able to bring furloughed employees back to work on a part-time basis on the flexible furlough scheme. A new agreement will be needed for employees wishing to do so, as furloughed employees on existing agreements can not work.

Other considerations

Employers with more than 50 staff must publish risk assessments on their websites as workers are welcomes back. All employers must be aware of their duty of care to prevent employees being exposed to unnecessary risk.

New furlough agreements are available through Croner-i. That agreement should be kept for five years.

Warning against businesses who have dishonestly claimed on the furlough scheme, Ms Chadwick also advises businesses to maintain furlough agreement records for five years. “There will be businesses which have claimed furlough for staff and made staff continue to work. That is irresponsible. HMRC will be spot checking records for five years, so you should ensure you have all furlough agreements on file.”

Ms Chadwick warns that redundancies may be necessary, and that employees still have full employment rights. ‘Appropriate redundancy procedures must be followed’ she adds, including any potential alternatives to redundancy, such as temporary lay-off periods and reduced hours.

More support can be found through the Croner-i small businesses platform. Many of the issues can be found in the ‘flexible furlough under job retention scheme’ tab, alongside other related information. A furlough toolkit and frequently asked questions section can be found there, alongside a reopening the workplace toolkit – with resources to help operators reopen their workplace.

Discover more at Croner-i.