Employer to contribute 25% towards furlough scheme from august

calcotti

Jeremy535897 said: I think calcotti accidentally linked to the old direction.

You’re right, I can see now that I did. Apologies for that.

Thrugelmir

sharpe106 said:

The main confusion is that government ministers have said you can furlough anybody for pretty much any reason but the treasury directive does not say that, and in several place says something completely different to what the directive said earlier on. 

Bottom line is that without the scheme. Many smaller employers would have ceased trading very quickly. Difficult enough to trade month to month in normal times. Imposing an immediate lock down required an incentive to get people to buy in. 

unholyangel

Jeremy535897 said:

Grumpy_chap said:

Thanks Jeremy.  Not what I wanted to hear, nor do I think it is correct (morally) but thanks for providing the answer.

I don't promise to be right! I should mention that the quote you found was from the old Direction dated 15 April 2020. If you want to study it in detail, read the new one dated 20 May 2020 at:
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/886959/CJRS_DIRECTION_No2___20_05_2020.pdf
which @calcotti kindly sent to me for bedtime reading. It now says:
"5. The costs of employment in respect of which an employer may make a CJRS claim are costs which-
(a) relate to an employee-
 (i) to whom the employer made a payment of earnings in the tax year 2019-20 which is shown in a return under Schedule A1 to the PAYE Regulations that is made on or before a day that is a relevant CJRS day,
 (ii) in relation to whom the employer has not reported a date of cessation of employment on or before that day and
 (iii) who is a furloughed employee (see paragraph 6.1), and
(b) meet the relevant conditions in paragraphs 7.1 to 7.19 in relation to the furloughed employee."

I see "date" has changed to "day", for example, in 5(a)(ii). No doubt a learned barrister somewhere can explain why. I think calcotti accidentally linked to the old direction.

I don't claim that the government overtly said rehire people you don't want to keep long term, but I don't think they ever thought it would be restricted to cases where employers had made a finely balanced judgment to let someone go and rehired them in the hope of keeping their post once the CJRS was announced. That doesn't make sense when they extended it to voluntary leavers.

The change is to align with 5a(i). The previous reading might have caused confusion that they meant on or before the date of the cessation. 

But it basically does mean they haven't sent a leaving date for the employee on RTI. 

Jeremy535897

That makes sense to me.

Grumpy_chap

The official jargon is complicated imo, but

unholyangel said:

But it basically does mean they haven't sent a leaving date for the employee on RTI. 

So, an employer gives an employee, say, 12 weeks' notice on, say, 31st May.
May payroll (RTI submission) will already have been run, so CJRS valid.
If the employer pays PILON, this gets included in the next RTI and none can be claimed as the next RTI would have to declare redundancy / cessation.
If the employer pays June & July RTI as per normal payroll, this also does not need to declare the cessation date and CJRS can be claimed.  Especially if the employer said something like "we will continue to find ways to avoid the eventual redundancy" when they served notice on the employee.
It would only then be the last couple of weeks, eventually paid in August for which CJRS cannot be claimed as that would have the RTI with the cessation date reported.

Hope I now understand this correctly.  It is way out of anything I would ever be involved with.

unholyangel

Grumpy_chap said:

The official jargon is complicated imo, but

unholyangel said:

But it basically does mean they haven't sent a leaving date for the employee on RTI. 

So, an employer gives an employee, say, 12 weeks' notice on, say, 31st May.
May payroll (RTI submission) will already have been run, so CJRS valid.
If the employer pays PILON, this gets included in the next RTI and none can be claimed as the next RTI would have to declare redundancy / cessation.
If the employer pays June & July RTI as per normal payroll, this also does not need to declare the cessation date and CJRS can be claimed.  Especially if the employer said something like "we will continue to find ways to avoid the eventual redundancy" when they served notice on the employee.
It would only then be the last couple of weeks, eventually paid in August for which CJRS cannot be claimed as that would have the RTI with the cessation date reported.

Hope I now understand this correctly.  It is way out of anything I would ever be involved with.

Apologies, we may be making matters more confusing.

To help clarify, my understanding of it is if the employer has sent a leaving date on or before 19th march then the employee would not qualify under the scheme. 

It's a troublesome rule as it leads to unfairness if your employer runs a tight payroll versus a sloppy one. But it shows the government's intention was never for employers to rehire freely,  regardless of circumstance. 

sharpe106

It was never the original intention of the scheme for employers to rehire people freely, for example the guidance for administration

 If you’re an administrator

Where a company is being taken under the management of an administrator, the administrator will be able to access the Job Retention Scheme. However, we would expect an administrator would only access the scheme if there is a reasonable likelihood of rehiring the workers. For instance, this could be as a result of an administration and pursuit of a sale of the business.

  Just ministers and the press have pretty much said you can use the scheme for anything.