Personnel Advice and Slutions – Job Retention Scheme for Private Sector Employers

It would appear from the latest Govt. advice that the Job Retention scheme now does apply to Town and Parish Councils.


  1. If an Employer has agreed a temporary lay of with its workers as a result of the effects of the Coronavirus on its business, HMRC will reimburse 80% of the workers wage costs, up to a cap of £2500 per month.


  1. These workers are defined as “furlonged workers”.  This means that they have entered into an agreement with their Employer to take unpaid leave as a result of the businesses trading problems.


  1. Under current legislation, anyone who has agreed to unpaid leave, can ask to be made redundant after 4 weeks without pay.  However HMRC have indicated that the current payments could be made for upto 3 months.


  1. HMRC advice also states that Employers could choose not to fund the 20% difference between the 80% Govt grant and the Employees full pay.  This would result in HMRC paying the full wage bill for the 3 month period.  If an Employer did not want to reduce their Employees pay by 20% they would be wise to reach an agreement with their Employees for this pay reduction.


  1. This money will be available from HMRC, from the end of April.


Employers would have to find the money to pay the wage bill for up to 6 weeks, before the grants are paid.


  1. It is also unclear how the initial payments will be made.  Will it be weekly instalments based on the Employers weekly wage bill, or will there be an initial lump sum to cover the cash flow deficit between 1/3/20 and the start of the scheme?


  1. There is a possibility that Employers who make staff redundant due to lack of funds, could face claims for Unfair Dismissal if the “lack of funds” argument is undermined by the HMRC grant.


Please note that these details are subject to change.  With regards your own businesses specific needs, please get specific advice.

PAS General – Lay Off Mar 20

PAS General -Pay Cut Mar 20

Chris Moses LLM Chartered FCIPD

Posted Thursday, 7th July 2022