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Document updated/added on 07.11.2020

Topic: Changing terms & conditions and TUPE

Letter extending furlough
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Letter extending furlough

Letter extending furlough

With the government having now extended the Coronavirus Job Retention Scheme (CJRS) until 31 March 2021, if required use our letter to extend furlough for your staff.

Scheme extension

The government announced on 5 November 2020 that the CJRS is being extended until 31 March 2021 and that the flexibility which enables employees to be either on full furlough or flexible furlough is being retained. In the latter case, the employee works for you on a part-time basis but remains on furlough in relation to their usual hours not worked. You must pay the employee their full pay in the normal way for the hours they actually work (if any) and then under the CJRS they will continue to receive 80% of their regular wages, subject to a gross monthly cap of £2,500, for their furloughed hours. However, for claim periods running to 31 January 2021, the employee’s wages for their furloughed hours are being paid by the government by way of a CJRS grant. You only need to pay employers’ NI and the minimum auto-enrolment employer pension contribution on that reduced subsidised wage. The government will review the policy in January 2021 to decide whether economic circumstances are improving enough to ask employers to contribute more. Where the employee is flexibly furloughed, the monthly cap is calculated proportional to the hours they are furloughed.

Ongoing furlough requirement

If you originally advised your employees that you anticipated full or flexible furlough would last until a specific end date, once you’ve assessed your business position and taken a decision on whether you need to extend it beyond that date (and for how long), you should write to them confirming this. This is what our Letter Extending Furlough is for. You can continue to use this letter as many times as you need to extend full or flexible furlough while the CJRS still remains in place. The letter confirms the furlough extension and sets out the new anticipated end date for full or flexible furlough but makes clear that date isn’t definitive as it depends on some factors outside your control. It also confirms that the terms of the furlough arrangement remain as you previously advised the employee. However, if the employee has been on full furlough but you now want to extend furlough on a flexible furlough basis instead, i.e. with the employee now returning to work part time, don’t use this letter as you will need to enter into a new flexible furlough agreement with your employee - see our Letter Seeking Agreement to Flexible Furlough.

New consent?

Assuming you originally obtained employees’ written consent to full or flexible furlough (as applicable) and you made clear to them at the time that the anticipated furlough end date wasn’t definitive, and that the furlough may be extended beyond that date, you don’t need to go through the process again of seeking employees’ consent to the further furlough period, although you might decide that it’s safer to do so given that this latest CJRS extension was somewhat unexpected. That said, do always seek consent if the employee was on full furlough but has returned to work in the meantime (even on flexible furlough) and so this is now to be a new full furlough period, because their original consent to full furlough here will now no longer be valid because of their intervening return to work – see our Letter Seeking Agreement to Full Furlough.

 

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