Furlough calculation having just returned from Maternity leave

7Phil

mkaela said:

I’m just wondering if you got an answer and they’ve sorted it out for you? I’m in a similar position to you, having returned from maternity leave in September and receiving 3 months no pay and 2 months SMP April-September last year. My furlough is better at £783 (before tax), but my normal monthly earnings are £1,500 so I expected £1,200 furlough pay. I’ve been in contact with payroll and they said they’re following gov guidelines, but from everything I’ve read they’re going against the guidelines of calculating furlough including SMP or unpaid leave. 

I know you are trying to ask the OP so I will tag them in to see if they have had a response - @michaelahobson09

Your situation is rare in terms of timings and the gov.uk guidance is not specific enough to cover your situation.
Based on what I can see (as an amateur poster), you are protected under anti-discrimination law (Equality Act 2010).
Being pregnant or on maternity leave is a "protected charactaristic". 
The Equality Act 2010 will take precedence over the CJRS rules, meaning you should be given special accommodations for the way your furlough income is calculated. However, we don't know how this works in practice yet.

Your employer may not be fully aware of this because it is not black and white in the official CJRS guidance.

I would gently point them towards these facts. If you have a valid means to calculate your "normal wage" and your resulting calculation is lower because you were either pregnant or on maternity leave then you have a solid argument. But, please consult expert advice (because I am not one).

Unfortunately it may take time for your employer to make enquiries and get answers from HMRC, so work with them to help them get answers for you.

p77ler

My Daughter is in the exact same position having returned from maternity leave in September 2019 , with the added twist in that whilst her contract of employment states she works standard hours ,  receives a basic wage and not varied , is paid monthly In equal amounts , but did work a couple of days overtime on Jan & Feb, her employer has chosen to calculate her furlough using the ‘ varied’ option which has severely disadvantaged her as they are using her SMP benefit as part of the calculation . Despite many discussions with her employer , she has had no alternative but to raise  a grievance but despite HMRC guidance stating employers can choose the best option that fits with their employees , they won’t budge .... there is no clear guidance for those who fall into this scenario but they are being severely disadvantaged because of this ... I’ve tried contacting my local MP who quoted the GOV guidance  which doesn’t help the chancellor and the PM ... nobody is responding ... WHO CAN HELP ... 

Jeremy535897

The first question to raise is what her contract of employment says, as amended by her furlough agreement, and whether she agreed to it (whatever she did agree to, it seems she doesn't agree with the way her furlough pay is calculated). Did it just say her salary while on furlough would be equal to what the employer could claim under the CJRS? If not, what did it say?

The rule are not the most straightforward, but the guidance is not the last word. That is in the Treasury Direction. The definition of a fixed rate employee is as follows:
"7.6 A person is a fixed rate employee if-
(a) the person is an employee or treated as an employee for the purposes of CJRS by virtue of paragraph 13.3(a) (member of a limited liability partnership),
(b) the person is entitled under their contract to be paid an annual salary,
(c) the person is entitled under their contract to be paid that salary in respect of a number of hours in a year whether those hours are specified in or ascertained in accordance with their contract (“the basic hours”),
(d) the person is not entitled under their contract to a payment in respect of the basic hours other than an annual salary,
(e) the person is entitled under their contract to be paid, where practicable and regardless of the number of hours actually worked in a particular week or month in equal weekly, multiple of weeks or monthly instalments (“the salary period”), and
(f) the basic hours worked in a salary period do not normally vary according to business, economic or agricultural seasonal considerations."

The important point here is that there is a concept of "basic hours". It would not bother with this concept if any amount of paid overtime made the employee a non fixed rate employee. The fact that your daughter did a modest amount of overtime occasionally should be irrelevant. The problem with the guidance is that, in a lot of places, it seems to equate any sort of variation in pay due to hours worked with the conclusion that the employee is not a fixed rate employee. This is one of the most misunderstood areas.

The problem is that the employer is unlikely to want to change the calculation now. HMRC allow an employer some flexibility and say an incorrect basis can be used if it is reasonable, whatever that means. If the employer now changes the calculation, are they saying they don't think the original calculation is reasonable? Do they then owe your daughter extra back pay, and if they do, have they broken the rule that they have not paid her 80% of her reference salary, thus rendering all past claims under the CJRS for her repayable?

Aedgar123

I am the daughter , so to answer your questions my contract states....
" Your wage is paid at the rate of £** per hour at monthly intervals . Your hours are ... These are not variable"
I have a document I signed on return of maternity leave that states...
" Your fixed monthly salary before deductions is £****"

My wage slips state a basic wage which has not changed even though the amount of days I have worked in months leading up to April 2020 differed each month due to the amount of days in a month ... So some months I worked 8 shifts some 9 ... I always revieved this basic wage. It was not changed .
My manager claims because I worked overtime and one occasion I left work 15 mins early to collect my son's from nursey . Plus the months I was in reciept of SMP , I therefore am a varied worker . They say HMRC say they must use the months I had SMP to calculate my yearly average . This factor in the calculations brings my furlough down by £400 each month . 

My furlough letter states..." You will be paid 80% of your basic wage"
I have tried to point them towards the treasury directive legislation, they seem to think I fit the varied method because of all of the above but unfortunately for me and I'm sure I'm not alone this way of calculating my average earnings leads me to be indirectly discriminated die to being on mat leave a portion of last year . I'm really struggling to get this across to my employers and HMRC say it's their discretion and choice on how to apply the scheme . Please help
I'm at the appeal stage of my grievence . 

Aedgar123

Oh and to add to this in April I received the average of my wages calculated minus the smp .to me it seemed like the figure of 80% of what I usually earn so I didn't question the method they used at that time.Theb In my May wages they deducted the £400 a, calling it a furlough adjustment, and then included the smp which had brought my average earnings down so much. They said this was because of the changes to the scheme . They had to include SMP ,so they deducted the money they say they over claimed and then reduced my furlough on too of that. I also am aware that HMRC would not seek back any money of there was a reason to say I fitted the way they originally worked out my average . Therefore they took this money from me in may and technically HMRC Would not ask for it back . This is all as they class me as varied when I believe my contract and wage slips show I am fixed. Thanks

Jeremy535897

The answer to my first question is that your latest contract of employment says you should be paid a fixed monthly salary of £xxx and your furlough agreement says that you should be paid 80% of your basic wage. So your question to them is "this is what my contract and furlough agreement says you will pay me. Why aren't you paying me this figure?"

If they talk about how to calculate the CJRS and averaging in the time you were on SMP, you say "so what? I don't care what you think you can claim under CJRS. You have contracted to pay me a fixed monthly salary of 80% of £xxx. What you claim back is nothing to do with me, unless you claim back more for my net wage than you pay me, which is in breach of the rules."