Coronavirus Job Retention Scheme Online Portal to go live on 20th April 2020
Thursday, April 9, 2020
Thursday, April 9, 2020
The Parliamentary Select Committee made an announcement yesterday (Wednesday 8th April 2020) that HMRC’s online portal for the Coronavirus Job Retention Scheme will open on 20th April 2020 with a view to the first payments being made to employer’s on 30th April 2020. Please do ensure that your online PAYE is functioning and up to date.
It is anticipated that claims back dated to 1st March 2020 will be paid in the first round of payments made to employers.
Claims can be made weekly (where staff are paid weekly rather than monthly) but one only claim per week may be made. Claims can be made for salaries due up to 14 days in advance. It expects payments to be processed within 4 – 6 working days of a claim.
A number of employees are reporting that they have been furloughed but their employer is still requiring them to work. This is not permitted under the scheme and HMRC are setting up a dedicated hotline such that employees can report their employers for abuse of the scheme. If HMRC becomes aware of abuse, it can withhold payments to employers. Employers are required to keep written records of their employee’s furlough agreements for 5 years. If abuse is discovered retrospectively by HMRC, depending upon the severity of the abuse, criminal proceedings may be taken against the employer.
HMRC have confirmed that annual leave can be taken during furlough and must be paid on full pay. This includes bank holidays. We don’t know yet whether or how salary for annual leave can be claimed back from HMRC. I suggest it is likely that employers will be able to claim 80% of those costs and the employer will have to top up the other 20% but we wait to see if this will be confirmed.
In response to a question from David Johnstone MP, HMRC has confirmed that employees, who TUPE transferred to a new employer after 28 February 2020, will be eligible for furlough. It may however be difficult for the new employer to calculate the pay due to those working variable hours if it does not have access to the old employer’s PAYE records.
We expect a guidance document to be produced by HMRC within the next week on all matters to do with the online portal and furlough.
In the meantime, we can’t stress enough the importance of furlough agreements. The government’s guidance is that in order for an employee to be validly furloughed, the employer must discuss the furlough proposal with the employee and there must be an agreement by the employee to the changes to his or her employment contract and those changes must be confirmed to the employee in writing. It is not enough to simply to write to staff announcing that they are being furloughed and if that it all that an employer has done, it is likely to face difficulties in 6 – 12 months time when HMRC retrospectively investigates whether the claims for furlough were correctly made.