Which publicly funded organisations can consider furlough?
Some employers falling into the third group of organisations described above could understandably feel aggrieved that on the first reading of the guidance they are not able to furlough employees and rely on the Government scheme. Many publicly funded organisations that are not public sector employers, receive a package of public funding with little expectation on how that funding is used or applied, other than broadly for it to be used in providing the services it is contracted to deliver. Also, several publicly funded organisations have many different income streams and the element of funding that is received from the public purse can be only an element of their operating costs.
Unfortunately there is still no clear guidance on when employers falling into the third category identified above can use the scheme. The only reference in the guidance on this states that where organisations are not “primarily funded” from the public purse and whose staff cannot be redeployed to assist with the coronavirus response, the scheme might be appropriate to be used for some staff. This seems to suggest that where an employing organisation is not wholly or mainly funded by public funding and staff cannot be redeployed to work in areas in the effort to combat coronavirus, then it would be appropriate for the employer to access the scheme.
If considering applying for grants under the scheme a sensible approach would be to look at the combined total of your public funding and payments under the scheme and make sure it will not represent more than 100% of the level of total income you would have expected to receive during this period in a non-Covid scenario.
Local Authorities are expected to maintain support to suppliers and this should be considered:
Related FAQs
At 10am on the 21st July, we hosted the fourth of our “in conversation…” webinars, this time featuring the ninth largest private bank in the world, Swiss-based Julius Baer. Ward Hadaway partner Emma Digby once again lead the conversation, this time with Luke Downes and Darren Hirst from their investment and relationship teams on “Market outlooks – the before, during and after”. They were joined by Andrew Evans from our private client team to feed in his perspective. This will be of interest to individuals who are thinking about investment portfolios and pension pots, but also businesses keen to see how investors are viewing their sectors, markets and customers.
Luke and Darren took us through how the markets looked pre-Covid, how they responded to the pandemic, and obviously most importantly what we might expect going forwards. They took a look at the sectors that are seeing the quickest bounce-back, discuss which countries are likely to be the most attractive for investors, and where the long term financial gains are expected to be. They also touched on that imminent event, shrouded in mist recently but no less significant – Brexit! What is the expected effect on the markets, and who are likely to be the winners and the losers?
All employers in the UK are eligible to participate in the scheme. The purpose of the scheme is to allow employers to claim back employment costs if they have furloughed employees arising from the coronavirus crisis. Importantly this means the scheme is not limited to cases where the employee would otherwise have been made redundant.
Key points:
- Between 1 November 2020 – 30 June 2021, the government will reimburse employers for 80% of wage costs, up to a cap of £2,500 per month, with employers expected to contribute 10% of that 80% in July 2021 and 20% of that 80% in August and September 2021. Employers will still need to pay employer NICs and employer pension contributions (these cannot be claimed for).
- The scheme now also allows employees to return to work part time being on furlough for the remainder. See flexible furlough above for more information.
- The employer can agree to pay the employee more than it will be reimbursed but it cannot reclaim the additional amount or any other costs associated with the additional amount.
- The workers covered by the scheme are those who have been “furloughed” which is a leave of absence.
- Workers must be told about and agree to this change of status (see below).
- Employers have to continue to pay the furloughed workers and the Government will reimburse the employer.
- HMRC is administering the scheme and it has been extended until the end of September 2021
- Those who left employment and are re-employed and subsequently furloughed by agreement are eligible (please see the FAQ regarding redundancy and furlough above).
- Payments may be withheld if claims are based on inaccurate or dishonest information, or are found to be fraudulent. HMRC has put in place an online hotline for employees and the general public to report suspected fraudulent claims.
- The Government has made alternative help available for employers to continue to pay employees while the scheme is set up.
This free Getting back to business webinar was held on Thursday 7th May.
On this video, employment partner Edward Nuttman and Graham Vials went through what a consultation exercise is and when you are required to hold one. They then took you step by step through the process, describing all you will need to do to ensure legal compliance whilst at the same time being sensitive to the emotional and motivational impact on your employees and managers.
If the duties are so fundamentally different from their contracted role, then yes. For example, if you are asking a frontline clinical member of staff to undertake administrative tasks in another area, then this will be a fundamental change to their terms and conditions for which you need their consent.
If there is a minor alteration to their duties, or the clause within their contract is wide enough to cover their amended duties, then arguably to do not need their consent but best practice would be to obtain their agreement.
A licence to occupy premises is not an interest land and operates as a commercial contract between the parties that enter into it. Licences tend to be put in place to cover short periods and consequently they are generally a lot more flexible than commercial leasing arrangements. To that extent occupants under licences should review the contract to establish whether or not there are any provision allowing them to terminate on notice to the Licensor.
Occupants under licences that are granted for longer periods without the option to terminate may try to argue that the contract has frustrated because they are effectively unable to occupy.