• April 14, 2020

micebook “talks” furlough – what does it mean and how does it work?

micebook “talks” furlough – what does it mean and how does it work?

micebook “talks” furlough – what does it mean and how does it work? 1024 512 mustbeonit

Just a few weeks ago, most people hadn’t heard of the word furlough. Even Ami Naru, head of employment at TravLaw admitted having to Google the word. Now, a large proportion of those working in the UK events industry have been put on furlough.

So last week, we hosted a virtual micebook talks session featuring Ami and several #eventprofs, to answer all those burning questions about what this new “F-word” means. You can listen to the full podcast here and we have summarised some of the key takeaways below…

Furlough in a nutshell…

*An employer can put someone onto furlough under the government’s Coronavirus Job Retention Scheme with their consent. Whilst on the scheme, the government will step in and pay up to 80% of their wages up to £2,500, but the employee cannot do any work whatsoever. That includes social media posts, checking work emails, answering calls, PR & marketing etc.

*Employees could potentially take part in training while on furlough, as long as it does not generate immediate revenue. All the time the employee is taking part in training, the employer would be expected to top up the wage to 100%. Employers can top up to 100% anyway if they wish and can afford to, but there is no obligation to do so.

*You can take part in social activity with colleagues during furlough, for example virtual drinks or quizzes etc, as that is not work and is not in any way helping to generate revenues. It’s also important for keeping motivated and could help with mental health and loneliness.

*In order to be eligible for furlough, an employee must have been on payroll as of 28 February this year. If they weren’t, they can’t be furloughed.

*You can take another job if you are furloughed, but only if your contract allows and many contracts won’t allow that.

*If you are a director, you are allowed to carry out statutory duties such as filing accounts. Directors can only be furloughed with respect the salary they get under PAYE, not the dividends that many directors use to top up their pay.

*The furlough scheme is back-dated to 1 March and runs to 31 May. An employee has to be on furlough for a minimum of 3 weeks to qualify. It can be longer, and you can rotate people onto furlough as long, as they are on furlough for a minimum of 3 weeks.

*Tax, National Insurance and pension payments will be deducted from any wages paid on the furlough scheme so it does not mean you will receive £2,500 a month.

*Businesses will need a UK bank account and be on the PAYE scheme to take part in the furlough scheme. Once the government portal is up and running, employers will be able to apply for the wages of those employees they have put on furlough.

*The government has had three times as many employers as expected apply for this scheme. Employers need to be mindful of the fact it might not be up and running in time and there may be a delay for April payments under the scheme. If this is the case, employers need to work out what they will do if this is the case – they may have to cover wages until they can get the refund, find an alternative way of paying, for example via a bank loan, ask for employees consent to delay wages if cash flow is a problem, or explore alternative options such as redundancy.

The session also covers how to deal with the emotional and practical side and a personal account of what it is like to be furloughed. Tune in now to hear more