Furloughed workers: what being 'furloughed' means and how the Coronavirus Job Retention Scheme works
Chancellor Rishi Sunak has announced emergency measures in response to the coronavirus pandemic, including a huge bailout to cover the wages of millions of workers
The Chancellor said the government will cover 80 per cent of salaries - up to £2,500 per month - with all employers able to apply to HMRC to pay the wages of people who are furloughed.
What are furloughed workers?
Under the Coronavirus Job Retention Scheme, all employers in the UK will be able to access support to continue paying part of employees’ salaries who would otherwise have been laid off during the ongoing health crisis.
Furloughed workers are those whose employers cannot cover staff costs due to coronavirus, and as such they have been asked to stop working, but have not been made redundant.
Such employers are now able to access support to continue paying part of their staff’s wages, to avoid redundancies.
How does the scheme work?
If your employer intends to access the job retention scheme, they should discuss with you becoming classified as a furloughed worker.
This would mean that you are being kept on your employer’s payroll, rather than being laid off.
To qualify for this scheme, you should not undertake work for your employer while you are furloughed, according to gov.uk.
By doing so, this allows your employer to claim a grant of up to 80% of your wage for all employment costs, up to a cap of £2,500 per month.
Workers will remain employed while furloughed, and your employer could choose to fund the differences between this payment and your salary.
If your salary is reduced as a result of these changes, you may be eligible for support through the welfare system, including Universal Credit.
The scheme will initially run for at least three months, from 1 March 2020, with all UK businesses eligible, and will be extended if necessary.
What should employers do to access the scheme?
To access the Coronavirus Job Retention Scheme, employers will need to take the following steps:
- Designate affected employees as ‘furloughed workers,’ and notify your employees of this change - changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation
- Submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required)
HMRC are working urgently to set up a system for reimbursement, and existing systems are not set up to facilitate payments to employers.
If your business needs short term cash flow support, you may be eligible for a Coronavirus Business Interruption Loan.
Coronavirus: the facts
What is coronavirus?
COVID-19 is a respiratory illness that can affect lungs and airways. It is caused by a virus called coronavirus.
What caused coronavirus?
The outbreak started in Wuhan in China in December 2019 and it is thought that the virus, like others of its kind, has come from animals.
How is it spread?
As this is such a new illness, experts still aren’t sure how it is spread. But, similar viruses are spread in cough droplets. Therefore, covering your nose and mouth when sneezing and coughing, and disposing of used tissues straight away is advised. Viruses like coronavirus cannot live outside the body for very long.
What are the symptoms?
The NHS states that the symptoms are: a dry cough, high temperature and shortness of breath - but these symptoms do not necessarily mean you have the illness. Look out for flu-like symptoms, such as aches and pains, nasal congestion, runny nose and a sore throat. It’s important to remember that some people may become infected but won’t develop any symptoms or feel unwell.
What precautions can be taken?
Washing your hands with soap and water thoroughly. The NHS also advises to cover your mouth and nose with a tissue or your sleeve (not your hands) when you cough or sneeze; put used tissues in the bin immediately and try to avoid close contact with people who are unwell. Also avoiding touching eyes, nose and mouth unless your hands are clean.
As of Monday 23 March the prime minister has put the UK into lockdown and instructed all citizens to stay at home. People can only leave their homes to exercise once a day, go shopping for food and medication, travel for medical needs or to care for a vulnerable person, and travel to work only if essential. Police will be able to enforce these restrictions.
All non-essential shops will close with immediate effect, as will playgrounds, places of worship and libraries. Large events or gatherings of more than two people cannot go ahead, including weddings and celebrations. Funerals can only be attended by immediate family.
Children of separated parents can go between both parents' homes.
Anyone with a cough or cold symptoms needs to self-isolate with their entire household for 14 days.
The government has now instructed bars, restaurants, theatres and non-essential businesses to close and will review on a ‘month to month’ basis. Schools closed from Friday 20 March for the foreseeable future, and exams have been cancelled.
The over 70s or anyone who is vulnerable or living with an underlying illness are being asked to be extra careful and stay at home to self-isolate. People with serious underlying health conditions will be contacted and strongly advised to undertake "shielding" for 12 weeks.
For more information on government advice, please check their website gov.uk
Should I avoid public places?
You should now avoid public places and any non-essential travel. Travel abroad is also being advised against for the next 30 days at least, and many European countries have closed their borders.
What should I do if I feel unwell?
Don’t go to your GP but instead call NHS 111 or look online at the coronavirus service that can tell you if you need medical help and what to do next. 111.nhs.uk/covid-19
When to call NHS 111
NHS 111 should be used if you feel unwell with coronavirus symptoms, have been in a country with a high risk of coronavirus in the last 14 days or if you have been in close contact with someone with the virus.
Sources: World Health Organisation and NHS