1 Director Ltd Company - Furlough

dev006

If someone runs a Limited Company with 1 director and 1 other employee, where the director generally goes out to work as an IT contractor and the director's partner (employee) does the payroll, finances etc. and also does job searches for potential future work for the director, can they both be furloughed? Director's contract terminated at end March and there's no hope of further work in the medium term due to COVID-19, so the director can be furloughed. Both the director and partner draw a minimal wage from the limited company, but can the partner be furloughed?

Hermann

Yes provided they both meet the conditions to be eligible for the job retention scheme.

That includes doing no work for that business. So it's likely to do the payroll and administer the jrs claim the employee would need to come off furlough for a day then back on furlough. The minimum furlough period is three weeks so one day back a month is easily achievable.

silvercar

The director is allowed to do basic admin and fulfill legal responsibilities while under furlough. An employee can't do any work. So it may be worth considering whether the director could run the payroll for now.

Jeremy535897

silvercar said:

The director is allowed to do basic admin and fulfill legal responsibilities while under furlough. An employee can't do any work. So it may be worth considering whether the director could run the payroll for now.

The consensus is that for the truly risk averse, the furlough followed by one day working to do payroll followed by furlough is the preferred choice. For the less risk averse, they do the payroll and the CJRS claim and nothing else beyond statutory filing etc whilst on furlough. Only time will tell which was the right thing to do.