UK: Updates for Employers on How to Claim Through the Coronavirus Job Retention Scheme (CJRS)

UK: Updates for Employers on How to Claim Through the Coronavirus Job Retention Scheme (CJRS)

The recent guide on ‘how to work out 80% of your employees’ wages to claim through the Coronavirus Job Retention Scheme (CJRS)' has been updated with information specifically focusing on ‘how to claim’.

How to Claim – Updates

Reminder: Employers must only claim for periods when their employees were on furlough. Employers must decide on the length of the claim period but should also consider how frequently they run their payroll. Depending on the employer, the length of claim period will vary.

Employers cannot make more than one claim during a claim period; therefore, all furloughed employees should be included in that claim period. The reason for this being, employers will not be able to make another claim for the same period or one that overlaps.

Employers must claim for all their employees in each period at one time, changes cannot be made. As it currently stands, once you submit a claim, it cannot be amended, however HMRC is currently developing a process to allow for changes to be made.

A claim can be made in anticipation of a payroll run, at the point that the employer runs the employee’s payroll or once payroll has been run. It is possible to backdate claims from 1 March 2020 if employees were already furloughed at that point, however a claim cannot start any earlier than the date employees were first furloughed.

Employers must pay the full amount that they claimed for their employees to their employee, even if the business has gone into administration. When employers make a claim, they are agreeing that:

  • the grant they receive can only be used to pay their employee’s salary and the employer National Insurance (NI) contributions and pension contributions in relation to the salary paid to employees
  • any grants will be returned to HMRC immediately if the employer is unwilling or unable to use it to pay employee salaries and the employer NI contributions and pension contributions

Employers should not make a claim if they do not accept that they can only use the money they claim for making employee payments and that it must be returned to HMRC is they do not do so.

The government website has updated both its employer and employee guidance pages. The updates confirm that a collective agreement reached between an employer and a trade union, in relation to employees being place on furlough, is acceptable for the purpose of an employer claiming through the CJRS.

Fixed-Term Contracts

In the updates, additional guidance surrounding fixed-term contracts has also been provided. Employers can re-employ, furlough and claim for employees on fixed-term contracts if their contract expired after 28 February 2020 and a Real-Time Information (RTI) payment submission was sent to HMRC on or before 28 February 2020, or if their contract expired by 19 March 2020 and an RTI payment submission was sent to HMRC on or before 19 March 2020.

If a fixed-term contract has not already expired, employers can opt to extend or renew it. Employers can claim for employees where an RTI payment submission was sent to HMRC on or before 19 March 2020.

If the same contract started and ended between 28 February 2020 and 19 March 2020, then the employee on this contract would not qualify for the CJRS. This is not only applicable to those on fixed-term contracts, but to all other types of contract as well.