Flexible furlough: your questions answered

How will flexible furlough work? A Facebook Live session hosted by HR experts Peninsula UK outlined how the new system will operate.

The scheme starts on 1st July and allows people to come back to work on different working patterns with employers paying for the hours worked and the Government topping up to their normal weekly salary as of 19th March.

If they work variable hours, their pay would be calculated based on the higher of the average number of hours the individual has worked in the tax year 2019/20 or the corresponding calendar period in the tax year 2019/20.

To be eligible for the scheme employees will need to have been furloughed at some point before 10th June for at least three weeks. The furlough scheme is now closed to new entrants except parents who have been on extended leave, such as maternity or paternity leave, so long as other colleagues in their organisation have been furloughed in the past.

In the Facebook Live session in which Peninsula UK partnered with workingmums.co.uk, Kate Palmer said the scheme could help parents with childcare issues due to the phased return of schools. She also said that she hoped there would be clearer guidance on childcare from the Government before the summer holidays.

How furlough operates

Furlough has to be agreed by both employer and employee and the employer can end a period of furlough for business reasons outside of the minimum time period. Palmer said employers should confirm in a flexible furlough agreement in writing and might like to include that they will, for instance, post a rota the week before about the hours and insert a clause that hours may change according to business need. This would mean that employers don’t have to agree a new flexible furlough agreement every time hours change. Employers could also specify an end date for an agreement.

A flexible furlough agreement can last any time from a minimum of seven days to the end of October when the scheme ends. Employers could take people on and off flexible furlough over the next months.

As with the full furlough scheme which will continue to run and for which there is a minimum three-week period, payments are capped at 80% of pay for the furloughed hours up to a monthly cap. This is 2.5K pounds for full-time workers, but will be pro-rata’d in relation to hours worked.

From August, the Government will expect employers to pay towards the furlough scheme and the percentage they will pay will increase as the scheme winds down. If employers are making furloughed workers redundant they need to consult with them in the normal way.

Childcare

Palmer mentioned that employees can ask to be furloughed after 1st July if they have no available childcare, but they must have been furloughed previously. She said employers should have an open discussion with employees in these circumstances and that there was a legal responsibility of care on employers to be reasonable. While employees should show that they have done everything possible to find childcare, employers also had to show they had tried to find a solution, for instance, bringing forward annual leave booked for later in the year, working from home, agreeing a period of paid or unpaid leave, temporarily changing hours and allowing time off for dependents. If they did not, they could open themselves up to claims of unfair treatment or discrimination, but it would depend on the circumstances, said Palmer.

She advised employers to keep a clear log of hours for five years as she said HMRC will audit companies who have furloughed staff to check for fraud.

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