On the 20th March 2020, many businesses were forced to close their doors due to the COVID-19 pandemic. To support businesses and employees the UK Government introduced the Coronavirus Job Retention Scheme (furlough scheme). The purpose was/is to keep as many employees on their employer’s payroll as possible (albeit in a dormant state). The CJRS provided Gov’t subsidy of up to 80% of the employee’s wage, reducing the need for redundancies as business practices slowed.
As of December 13th, 2020 14.5% of the UK population had been supported in this way, a percentage that continues to rise through the most recent ‘lockdown’ conditions. The CJRS scheme is due to end on the 21st April 2021, however Rishi Sunak is considering extending the initiative if the effects of the pandemic still warrant a need for it.
There are a number of rules surrounding what an employee can and can’t do whilst on furlough. However if you are struggling to support the financial needs of you and your family, here are some tips as to what is possible:
Universal Credit – If you are eligible for Universal Credit the amount you are currently receiving as Furlough will affect how much money you will be entitled to. Please be aware that if you are already receiving tax credits or any other benefits, these will stop if you apply for Universal Credit and cannot be started again.
Job Seekers Allowance – Those who were contracted to less than 16 hours per week before being placed on Furlough may be entitled to the New Jobseekers Allowance. If your contracted hours were 16+ per week you will not be entitled to JSA even if your earnings have reduced whilst you’re on Furlough. You can use the benefits calculator on the HMRC Website to identify what you may be eligible for; https://www.gov.uk/benefits-calculators
You can secure another job providing your employer is happy for you to do so. Seeking additional employment will not affect the contribution that your current employer can claim under the furlough scheme. Before you seek new employment you will need to check within your contract that there is no clause which forbids you to do so, however, if this is the case you could ask your employer to temporarily change it. It is important to note that you must be prepared to return to work as soon as your original employer requires you to. If you do start a new role you will need to complete a Statement C (New Starter Checklist) so that your new employer can inform HMRC that you are working for them; you can find this document on the HMRC Website; https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/873648/Starter_checklist_English.pdf
Although there are many businesses unable to operate in the current crisis, recruitment agencies across the UK are advertising for urgent temporary roles to help with the pandemic. Are you new to contracting and starting a new contract? If so, we would love to help you out. Our objective is to provide employment rights and accurate payroll services to the temporary workforce of the UK. You can start your new role with confidence that behind the scenes we have got your admin and payroll covered. Contact us today to find out how we can support you.