Furloughing “new” employees after 30 June
One of the changes to the furlough scheme announced by the Chancellor last Friday was that the scheme will close to new entrants on 30 June, and so the last date on which an employer can furlough an employee for the first time is 10 June 2020 (so they can complete the minimum three week furlough period by 30 June). The Government fact sheet published following the Chancellor’s speech states that “employers will only be able to furlough employees that they have furloughed for a full three week period prior to 30 June”.
The question many of our clients are asking is: can we “re-furlough” an employee who has returned from furlough, or who returns before 30 June? Or are they treated as a “new” employee? We are hoping that this will be clarified by a new or amended Treasury Direction but, as yet, that has not been published.
We have, however, been made aware of advice provided to one of our clients by HMRC, which confirms that employers can re-furlough employees after 30 June, as long as they were furloughed for a minimum three week period at any time prior to 30 June 2020. While this is not definitive, it is a helpful indication as to how HMRC envisages this change being applied.
Remember, too, another key change to the scheme going forward is that the total number of employees that an employer can furlough cannot exceed the maximum number for whom they have claimed previously under the scheme. It is not clear what date is relevant for these purposes, but it seems likely to be effective from 1 July.
To read our latest update on the UK Government’s announcement regarding the end of the furlough scheme, please visit MayerBrown.com.