As you will no doubt be aware, the Coronavirus Job Retention Scheme is changing from 1st July 2020 with the introduction of the Flexible Furlough Scheme.
CMN’s specialist HR Company Tamar HR have put together the below guidance on these changes along with a template below that you can cut and past and use for this purpose.
You will be able to bring employees who are currently furloughed back to work part time with the Government still paying 80% of the hours they do not work. Also, employees that have been furloughed in the past, and may now be back at work, can also be placed on the new scheme to work part time with the Government paying 80% for the hours they do not work.
The Flexible Furlough Scheme requires employers to agree for employee to be placed on it. This is a new agreement and replaces the one that was required at the start of the Coronavirus Job Retention Scheme. If you plan to place employees on Flexible Furlough, they will need to sign a new agreement and you will need to keep the agreement on record for six years. You shall also be required to keep a record of the employees hours worked and the hours they have been furloughed for six years.
Please find a new template agreement attached which can be used for this purpose.
Should you have any questions or queries then please do not hesitate to contact us
Outline template for COVID-19 furlough: proposed changes to your employment
[ON HEADED NOTEPAPER OF EMPLOYER]
Dear [EMPLOYEE’S NAME],
RE: COVID-19 furlough: proposed changes to your employment contract from 1 July 2020.
As you know, due to the ongoing COVID-19 pandemic [NAME OF EMPLOYER] remains unable to operate the business as normal. As a result of the [reopening of your place of work/increased need for your role/expected upturn in business], we are in a position for you to return to work on reduced hours from [DATE].
We are phasing the return to work because of [reduced capacity within our workplaces because of social-distancing measures/the gradual reopening of our places of work/our cautious approach to returning to “business as usual”].
We are therefore proposing to extend your furlough to 31 October 2020. Your furlough will be on a flexible basis where you can work some of your normal hours, at your normal rate of pay, and receive furlough pay for the remainder of your contractual hours.
From 1 July 2020, the Coronavirus Job Retention Scheme (CJRS) will be modified so that we can bring back to work employees who have previously been furloughed for any amount of time and any shift pattern, while still being able to claim a CJRS grant for their normal hours not worked (“flexible furlough”).
The further changes we are proposing to your contract will enable us to begin to resume operations as the country emerges from the lockdown period and the recent restrictions are gradually lifted. The flexible furlough arrangement will run until 31 October 2020 at the latest, although you may be brought back to work your normal contractual hours earlier than that, as the need arises.
It is likely that the published guidance on the CJRS will be further updated and that additional guidance or legislation may be published, clarifying aspects of the scheme. We have set out in this letter our current understanding of the changes we need to make to your contract of employment to implement flexible furlough within the confines of the CJRS. However, we may need to make additional variations to your contract in the light of further clarification of the CJRS.
We have set out below the proposed changes to your employment contract.
- With effect from 1 July 2020 up to and including 31st October 2020 (“flexible furlough period”), you will be placed on a period of flexible furlough.
- Your new working hours are [DETAIL] OR WE will notify you every week what hours we require you to work.
During the flexible furlough period, any periods of time during your usual working hours when you have been authorised not to work by the terms set out in this letter shall be referred to as “furloughed hours”. Your usual working hours will be calculated according to the rules of the CJRS. For more information contact [NAME].
- During any period when you are working for us in accordance with the above schedule, your normal terms and conditions of employment will apply. During any furloughed hours you shall be regarded as furloughed. While you are furloughed we shall be under no obligation to provide any work to you, and you agree not to attend your usual workplace or carry out any work on our behalf, unless requested to do so and permitted under the rules of the scheme. You should note that it is a condition of our eligibility for the CJRS that furloughed employees do not provide any services or generate any revenue for the employer, or for any organisation linked or associated with the employer, during furloughed hours.
- We may make further changes to your working pattern during the flexible furlough period, according to the needs of the business. We will write to you to confirm any significant variations to your hours of work or your working days.
- During the flexible furlough period, your pay in respect of furloughed hours (“furlough pay”) shall be [reduced to 80% / paid at 100%] of your normal pay subject to the monthly cap imposed by the CJRS. That sum will be adjusted to reflect the proportion of your usual working hours you are furloughed. Tax, National Insurance contributions and any other statutory deductions will be deducted in the usual way. You agree to waive any entitlement to further remuneration in respect of furloughed hours during the flexible furlough period.
- If you are opted in to automatic enrolment, your minimum employer pension contributions will be paid in the normal way during the flexible furlough period.
- Your “normal monthly remuneration” for the purposes of this letter will be calculated as at each normal monthly payment date and will be the higher of:Your total earnings in the corresponding monthly pay period in the previous year, not including any payments which are not regular salary or wages and cannot be recovered under the CJRS; or Your average monthly earnings paid to you during the tax year 2019 to 2020, or the entirety of your employment if you have worked for us for less than 12 months, not including any payments which are not regular salary or wages and cannot be recovered under the CJRS. Where you have worked for us for less than a month, a pro-rata calculation will be done to work out your estimated monthly earnings.]
- If you become sick during the flexible furlough period, you are required to notify [NAME OF LINE MANAGER] of your absence.
- Your flexible furlough period will end on [DATE] or, if earlier, when any of the following events occur:
-You or [NAME OF EMPLOYER] cease to be eligible for funding under the CJRS;
-Your employment is terminated for any reason; or
-Your employment is resumed on your normal terms and conditions or on such terms and conditions as further amended to take account of the applicable circumstances, provided that we have provided at least [one week’s] notice to you (or such shorter period as agreed between us) that your employment will resume on such terms.
- When your flexible furlough period ends, in the event that there is still any disruption in provision of work and accordingly a diminution in the requirements of the business for work of a kind for which you are employed, or any other occurrence affecting the normal working of the business in relation to the work you are employed to do, we reserve the right not to provide you with work, without any pay except for statutory guarantee payments or shorter working hours with pay only for hours worked.
- You will continue to accrue holiday in the normal way during the flexible furlough period and you may request and take holiday during furlough provided that you obtain prior approval for any holiday in the usual way.
The remaining terms of your Contract shall be unaffected by these changes. You may carry out unpaid voluntary work and may undertake training during furloughed hours, provided that it does not involve the generation of any revenue for [NAME OF EMPLOYER] or any associated organisation and that it meets any criteria set out in the CJRS. We will ensure that for any mandatory training which we ask you to complete during furloughed hours you will receive at least the National Minimum Wage or National Living Wage at the applicable rate for the time spent training, to the extent that it is not satisfied by the pay you receive during the flexible furlough period.
If you agree to these changes, please indicate your acceptance by [signing and returning the enclosed copy of this letter to [NAME] OR [email [NAME] with ‘I accept the terms and conditions of the flexible furlough agreement’ by [DATE]. The changes shall be immediately effective from the date of your acceptance. You should keep your signed copy of this letter safe, together with your Contract, which shall be amended by this letter.
If you have any questions, please contact [NAME].
For and on behalf of [NAME OF EMPLOYER]
I agree that my Contract shall be varied by the revised terms set out in this letter with immediate effect. I confirm that I shall be treated as a furloughed employee for the purposes of the Coronavirus Job Retention Scheme during any furloughed hours and understand the conditions which the government has attached to this scheme.
[NAME OF EMPLOYEE]
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