Understanding furlough pay
Since the lockdown came into action, many businesses have shut down for the foreseeable future meaning that thousands of staff are no longer working and therefore not earning money. The government quickly introduced a job retention scheme allowing employers to claim 80% of furloughed employees monthly wage up to £2,500 per month, per employee.
It is important not to confuse being furloughed with being unemployed or being let go from a company. A furlough is an unpaid leave of absence, a temporary measure. Employees remain technically employed by the company, but they cease working and do not earn a salary.
Furloughing staff can help your organisation reduce financial pressures and retain an experienced and trusted workforce that can return once COVID-19 has passed, or when their own symptoms subside and their period of isolation ends.
You can read the full furlough pay guidance here
And guidance for your employees can be found here
An an employer, who can you claim for?
This scheme is available for employees on PAYE with full time and part time contracts, agency contracts and employees on flexible hours or zero-hour contracts.
- Employees who are furlough are only eligible for this, you cannot be working on reduced hours and claim for these employees.
- Any employees doing other work and receiving pay are not eligible for furlough pay, however employees can do voluntary work and still receive furlough pay.
- Any employees that started after 28th February are not eligible for Furlough pay.
- Any employee on sick leave will only be eligible for furlough pay once their sickness leave is over.
How to claim furlough pay
To claim for your employees, you will need the agreement with the employees in their contract. You will then also need:
- Your ePAYE reference number
- The number of employees being furloughed
- The claim period (start and end date)
- Amount claimed (per the minimum length of furloughing of 3 weeks)
- Your bank account number and sort code
- Your contact name
- Your phone number
