CPA Bulletin

40 CPA Bulletin > August 2020 www.cpa.uk.net Compelling Workers to take Holidays During the COVID-19 crisis, the Government has included in their guidance for employees on furlough, that they can still be compelled by their employer to take holiday, provided the correct notice is given. The policy is that for each day the employer wants the employee to take as holiday, they must give twice the notice to the employee. So, for example, by asking the employee to take a week’s holiday leave, the employer must give two weeks’ notice. As a reminder, any holiday the employee is required to take must be paid at their normal rate, and not at the 80% furlough rate the Government stipulates under the Job Retention Scheme (JRS). Legal NEWS LEGAL: 1 Previously to this, employees had to have a minimum of three weeks furlough at any one time. Now employers have the facility to bring in employees for as much or as little as they are required each week. The modification to the JRS still allows employers to claim for those hours an employee does not work, subject to a cap of 80% of the employee’s normal wages, capped at £2,500 per month. This is subject to the employee being previously furloughed for at least three consecutive weeks between 1st March and 30th June and successfully previously receiving a grant. Changes in August From 1st August, employers will have to pay their employees’ National Insurance Contributions (NIC) and pension contributions and can no longer claim a grant for these. Until 31st August, the government will pay 80% of furloughed employees wages up to a cap of £2,500 for hours not worked. Employers must pay their employees for the hours they work. Employers must pay their employers’ NICs and cover all pension contributions. This is irrespective of the hours an employee works or does not work. Changes in September From 1st September, the government will pay 70% of furloughed employees wages up to a cap of £2,187.50 for hours not worked. Employers will pay an additional 10% of an employee’s wages to raise it to 80% of their wages (to a cap of £2,500 per month). The employer must also cover all NICs and pension contributions. Changes in October From 1st October, the government will pay 60% of wages up to a cap of £1,875 for the hours the employee does not work. Employers will pay an additional 20% of an employee’s wages to raise it to 80% of their wages (to a cap of £2,500 per month). The employer will continue to pay all NICs and pension contributions. The scheme closes on the 31st October. Further information can be found at https://www.gov.uk/guidance/claim- for-wages-through-the-coronavirus- job-retention-scheme Flexible Furlough Rules Published Furlough Fraud The Government has announced plans which are being drafted by HM Revenue and Customs (HMRC), under the Corporation Tax/ Income Tax - Taxation of Coronavirus Support Payments to tackle individuals and companies who abused the Government’s business support initiatives. Under these proposals HMRC will have the authority to review any grants made to employees through the Job Retention Scheme (JRS), which have been used correctly to pay workers’ wages, and to ensure employers have not been overpaid furlough reimbursement. If any overpayment or monies received but not spent on wages was discovered, HMRC would be allowed to reclaim the monies through income tax assessments. The proposals will give employers a 30-day period to admit to any irregularities to HMRC on any claims made. After that period has elapsed, HMRC will pursue companies using both criminal and civil powers. The plans will also give powers to impose penalties and to pursue directors of insolvent companies personally. From 1st July the Government’s Job Retention Scheme (JRS) evolved to allow flexible working for employees.