The COVID-19 pandemic has brought about a lot of changes to the workplace. One such change has been the introduction of furlough agreements. Furlough agreements have allowed employers to temporarily lay off their employees while still providing them with some financial support. However, there are some rules that need to be followed when it comes to furlough agreements.
1. Communication
It is important that employers communicate clearly with their employees about furlough agreements. The employee must receive a written agreement outlining the terms and conditions of the furlough, which should include the duration, the amount of pay, and any other relevant details.
2. Duration
The duration of a furlough agreement is generally a maximum of 12 weeks. However, due to the ongoing pandemic, the government has provided some flexibility, and the duration can be extended if necessary.
3. Pay
During the furlough period, the employee will receive a minimum of 80% of their regular pay. The government has capped this amount at £2,500 per month. Employers can choose to pay more than the minimum amount, but they are not required to do so.
4. Working
Employees cannot carry out any work for the employer while on furlough. However, they can undertake training courses or volunteer for other organizations.
5. Tax and National Insurance
Employees will still have tax and National Insurance contributions deducted from their pay while on furlough. Employers will also have to pay employer National Insurance contributions on the full amount paid to employees.
In conclusion, furlough agreements are a useful tool for employers during these uncertain times. However, it is important to follow the rules set out by the government to ensure that both employers and employees are protected. Clear communication, duration, pay, working, and tax and National Insurance are all crucial components of any furlough agreement.