Coronavirus Job Retention Scheme & Furlough Leave

Latest Guidance from HMRC

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What are the employment issues?

Changing the status of employees to a furloughed worker remains subject to existing employment law. Generally, where an employee’s contract contains a layoff or short term clause employers should be able to place employees on furlough leave. Where there is no such clause, it is best advised to get agreement from the employee.

Additionally, a 20% reduction in salary will be a change in terms and conditions of employment. Where employers are not topping up the government payment, they should also seek agreement from the employee.

Given the current situation and the alternatives for those employees should they not agree, one can expect that most employees will agree. That said, prudent employers will seek to get their employees agreement as part of their furlough leave process.

Template letter to employees being place on furlough leave..

Impact on BrightPay

We are currently awaiting instruction from HMRC as to the software changes required. Should there be an impact on payroll software, we will implement an upgrade as soon as we can.

In the meantime, you should set up an addition type entitled "Furlough Pay" or similar, to facilitate reporting at a later date.