Returning from SMP to Furlough

bex_84

Hi, I wonder if anyone can advise. 

I am currently on Maternity leave receiving Statutory Maternity Pay from my employer. I am due to return when this runs out after my 39 weeks on Monday 22nd June 2020. The business is currently unable to operate due to the virus so all staff are Furloughed. My employer is happy to do anything they can to support me but doesn’t have the funds to pay me themselves. 

So, my questions are;

Can they put me on Furlough from 22nd June?
Do they need to claim for this by 10th June Furlough deadline? 

We are a small business (4 employees) and are really struggling to get our heads around it and don’t want to claim anything we are not entitled to. I would come off SMP 2 weeks early if it meant I could be furloughed as the difference in payment would be very small and we don’t expect to be open until mid September. My employer is happy to waive the 8 weeks notice period I have seen regarding returning to work early from Mat leave. 

Many thanks in advance for any help

poppy12345

The 10th June is the last date which you can be furloughed, so your employer needs to be quick. Is your employer also aware that furlough changes in August?

Jeremy535897

I think this is an issue Martin was looking at. I think the issue is that SMP cannot be included in a CJRS claim, and SMP is compulsory so cannot be waived.

Jeremy535897

The thread I recalled is here:
https://forums.moneysavingexpert.com/discussion/6153473/maternity-and-furlough

Not really much help. There have been suggestions that people can come off maternity early to be furloughed. The guidance dodges the question, just giving a calculation method for people returning from maternity leave:

Employees returning from family-related statutory leave

"Family-related statutory leave includes maternity leave, paternity leave, shared parental leave, adoption leave, parental bereavement leave and unpaid parental leave.

For employees on fixed pay, claims for full or part time employees furloughed on return from family-related statutory leave should be calculated against their salary, before tax, not the pay they received whilst on family-related statutory leave. The same principles apply where the employee is returning from a period of unpaid statutory family-related leave.

Claims for those on variable pay, returning from statutory leave should be calculated using the highest of either:

• 80% of the same month’s wages from the previous year (up to a maximum of £2,500 a month)
• 80% of the average monthly wages for the 2019 to 2020 tax year (up to a maximum of £2,500 a month)"

The Treasury Direction is less clear. For unpaid leave, for example, it is quite clear that furlough can only begin when the unpaid leave was intended to finish:
"6.4 Where, during the period mentioned in paragraph 12, a period of unpaid sabbatical or other period of unpaid leave is enjoyed by an employee (“unpaid leave”)-
(a) no CJRS claim may be made in respect of the period of unpaid leave,
(b) the period described in paragraph 6.1(b) [furlough] must not begin during the period of unpaid leave."
This is relevant because there is no equivalent provision for SMP. There are provisions that treat SMP in the same way as unpaid leave, but only for actually calculating the amount of CJRS that can be claimed for fixed rate employees (see paragraph 7.10, 7.13 and 7.14).
However paragraph 8.6 is unhelpful:
"8.6 No CJRS claim may include amounts of specified statutory payments in respect of an employee during the employee’s period of furlough and the gross amount of earnings falling for reimbursement as described in paragraph 8.2 must be correspondingly reduced.
8.7 The specified statutory payments for the purposes of paragraph 8.6 are- (a) Statutory Maternity Pay pursuant to section 164 of SSCBA or section 160 of SSCB(NI)A;"

It doesn't say you can't be furloughed, but payments of SMP cannot be claimed for under CJRS, so what would be the point, unless you were entitled to more than SMP under your contract of employment, which it appears you are not.

One solution might lie in whether you could terminate SMP by working too many KIT days, but you have to be furloughed by 10 June, so unless you are up against the limit already, I don't think that is the answer.

You could perhaps force an end to SMP by breaking this rule:

"3.11 When SMP ends

Your SMP must end when your employer has paid you SMP for 39 weeks.

It can end earlier than this if after the baby is born, but before the end of the maternity pay period, you work for an employer who did not employ you in the qualifying week. Your employer will not pay you any more SMP and must stop paying SMP to you from the week you started work. It is your responsibility to tell the employer paying you SMP about your new job. You must do this as soon as possible, and make sure you return any SMP payment you get that covers the week you started work and any part of the period after you resumed work."

How practical this is I don't know.

I think I see a way out of the dilemma though. If your employer furloughs you today for three weeks, that period will end after your SMP ends, so there will be a claim for you from 10 June, and you will receive some furlough in respect of the period after 22 June. This would mean you would be paid SMP to 22 June plus what I have said your employer could recover under the calculation above from 23 June. I can't be sure it would work, but I think it is worth a go.

LilElvis

Jeremy535897 said:

I think this is an issue Martin was looking at. I think the issue is that SMP cannot be included in a CJRS claim, and SMP is compulsory so cannot be waived.

The problem is that the employee must give the employer 8 weeks notice if they wish to change the date at which they are returning to work from maternity leave. I can't see anything that allows this to be waived by mutual consent.

Jeremy535897

LilElvis said:

Jeremy535897 said:

I think this is an issue Martin was looking at. I think the issue is that SMP cannot be included in a CJRS claim, and SMP is compulsory so cannot be waived.

The problem is that the employee must give the employer 8 weeks notice if they wish to change the date at which they are returning to work from maternity leave. I can't see anything that allows this to be waived by mutual consent.

As I said, I don't think this matters.

LilElvis

Jeremy535897 said:

LilElvis said:

Jeremy535897 said:

I think this is an issue Martin was looking at. I think the issue is that SMP cannot be included in a CJRS claim, and SMP is compulsory so cannot be waived.

The problem is that the employee must give the employer 8 weeks notice if they wish to change the date at which they are returning to work from maternity leave. I can't see anything that allows this to be waived by mutual consent.

As I said, I don't think this matters.

It's specifically mentioned in the scheme guidance:

"If you agree to go on furlough and end your maternity leave early, you will need to give your employer at least 8 weeks’ notice and you will not be eligible for furlough pay until the end of the 8 weeks."

Jeremy535897

My suggestion doesn't involve ending maternity early, but furloughing before it ends. I don't think the Treasury Direction prevents furloughing while on maternity. The guidance wouldn't foresee the point because you can't recover SMP via CJRS, and there was no 10 June deadline. I agree it's not 100% clear, but the alternative just seems to be to give up.

bex_84

Thanks everyone. 

I know I should give my employer 8weeks notice but would there be any evidence of this? My employer is happy to count a discussion we had at the beginning of furlough as this notice if they need to make any statement that I gave it. 

My employer is aware of the upcoming changes to furlough. I’ve worked there for 8 years, my pension and NI contributions are very low as I only work 16hrs per week so this isn’t an issue for them. We hope to open in Sept so there will be funds to pay wages for some staff and furlough contributions as needed. 

If I understand correctly then Jeremy’s solution of submitting a claim by 10th June but not claiming any money for me for the period up to 22nd June seems like the best option. With the lack of absolute clarity I think that even if this were deemed to be incorrect at a later date I/we could defend the decision and it wouldn’t look like we were trying to do anything fraudulent. 

Thanks so much to the three of you for taking the time to reply. 

Becky

Jeremy535897

Claiming you had a conversation in the past that you didn't have, particularly when it means your employer can claim CJRS for 2 weeks they could not otherwise claim, probably is fraudulent. My suggestion is from a study of the underlying legislation, and I think it is the correct interpretation, but this is new untested legislation, so I could well be wrong. There is a world of difference between these two choices.

bex_84

Sorry I don’t think my post format helped. I can’t see how to reply to specific posts. In my defence I’m typing on my phone and juggling children. 

My 8 weeks notice comment was in response to LilElvis’s comment. I wouldn’t need to end my Mat leave early in order to take the route you (Jeremy) suggested so it wouldn’t apply. 

Thanks again