Coronavirus Job Retention Scheme - Updated Guidance

09 April 2020

Author: Sarah Cochrane
Practice Area: COVID-19 , Employment Law


Following the publication of our briefing on the Government’s Coronavirus Job Retention Scheme (the “Scheme”) on 27 March 2020, the Government published updated guidance on the Scheme on 4 April 2020.

Whilst a number of questions remain unanswered and a lot of uncertainties remain, the updated guidance provides the following clarifications:

1. Who is covered?

In addition to categories included in the original HMRC guidance, the following groups have been added as eligible for the Scheme:

  • apprentices;
  • office holders, including company directors;
  • salaried members of Limited Liability Partnerships;
  • agency workers

The guidance sets out further detail in relation to claiming for individuals in the above categories.

Any employee who is working reduced hours or receiving reduced pay shall not be eligible for the Scheme. There remains a prohibition on the employee carrying out any work for their furloughing employer during furlough.

2. When will the online service be ready?

It is anticipated that the online service which will be used by employers to claim under the Scheme will be available at the end of April 2020.

3. What is and is not included in the 80% (and subject to the cap of £2,500)?

The previous guidance published by the Government stated that fees, commission and bonuses should not be included in the calculation. However, the updated guidance confirms that an employer can claim for any regular payments which they are obliged to make to their employees; which includes past overtime, fees, commission, bonuses and non-cash payments. However, discretionary bonuses, commission payments and non-cash payments is not be included in the 80% which employers can reclaim from HMRC under the Scheme.

Employer national insurance contributions and minimum auto-enrolment pension contributions can be claimed under the Scheme. However, if an employer chooses to top up an employee’s salary, they are not permitted to claim for the associated additional National Insurance or pension contributions.

Employers should also be aware that if an employee is only furloughed for part of a pay period (such as three weeks in a payroll month), the grant will be pro-rated accordingly.

4. Are employees entitled to undertake volunteer work whilst on furlough?


Furloughed employees are permitted to take part in volunteer work as long as it does not provide services to or generate revenue for or on behalf of an employer’s organisation.

5. Are employees permitted to undertake training whilst on furlough?


Furloughed employees are permitted to undertake training if requested to do so by their employer. Employees are entitled to receive at least the appropriate rate of national minimum wage (NMW) for any time spent undertaking any such training. If an employee’s NMW entitlement is in excess of the furlough payment, the employer will be liable for the difference.

6. Can employers re-employ employees who were made redundant or whose employment came to an end for another reason on or after 28 February 2020?

Yes. The updated guidance provides clarification that an employer can re-employ any employee who was made redundant or who stopped working for the employer on or after 28 February 2020 and place them on furlough. It appears from the guidance that the reason for the employee leaving is not relevant to the issue of whether or not the employer can make a claim under the Scheme.

Employers must be aware that if any employee is subsequently re-engaged, their continuity of service will be preserved. If the employer seeks to dismiss the employee again at the end of the furlough period, the dismissal will need to comply with existing employment law or there is a risk of the employee bringing a claim for unfair dismissal. We would recommend that advice is sought in relation to dismissing an employee where they have been re-engaged by their employer in order that they can avail of the Scheme. Re-engaging an employee who has previously been made redundancy may also mean that redundancy payment (and any payment in lieu of notice) would have to be repaid.

7. What if an employee has more than one job?

If an employee works for more than one employer, that does not prohibit each, any or all of their employers from placing them on furlough. Employees can be furloughed for each job, provided that they were already contracted to work for the employer on or before 28 February 2020.

The updated guidance also confirms that employees are entitled to commence employment with a new employer whilst on furlough provided that the contract of employment with their existing employer does not preclude them taking on new employment.

8. Can an employee be furloughed if they are on sick leave?

An employer cannot make a claim under the Scheme in respect of any employee who is on sick leave or self-isolating and in receipt of Statutory Sick Pay (“SSP”).

An employer can furlough an employee when they are no longer in receipt of SSP.

9. Can an employee who is shielding be furloughed?

The previous guidance stated that employees who were shielding could be placed on furlough. The updated guidance states that employers can be furloughed if they are shielding in line with public health guidance and “if they are unable to work from home and you would otherwise have to make them redundant”. This has caused confusion as it would appear to limit furlough for shielding employees to a redundancy situation only. This seems inconsistent with the guidance on employees who cannot work because of childcare responsibilities, which is significantly less stringent and is not contingent on redundancy.

One possible interpretation is that in relation to shielding employees, the employer does not actually have to prove they are in a redundancy situation in line with the strict legal definition of the word “redundancy”. Instead it may be sufficient to show that the shielding employee cannot work from home and there is no other work that they are able to do because of the medical advice given to them to stay at home they are thus “redundant” for the time being. This is certainly an area where further clarifying guidance from Government is needed.

It is also important to note that employees who are shielding and who are not furloughed will not be entitled to SSP if neither they, or a member of their household, are displaying symptoms of COVID-19.

*Please note that this information is for guidance purposes only and does not constitute, nor should be regarded as, a substitute for taking legal advice that is tailored to your particular circumstances.