Thousands of workers will miss out on furlough pay due to loophole despite ‘qualifying’
THOUSANDS of new starters are still missing out on vital furlough payments due to a loophole in the scheme.
The coronavirus jobs retention scheme sees the Government cover 80 per cent of the wages of furloughed employees, up to £2,500 a month, if they can't work due to the pandemic.
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The scheme, announced by Chancellor Rishi Sunak in March, went live on April 20 and is set to distribute payments by the end of the month.
Last week, the Treasury extended the scheme to include those who were on the payroll on March 19 2020 to help new starters - an extra three weeks on the previous February 28 2020 deadline.
It claims that the extension will help an extra 200,000 employees but it's been criticised by experts for continuing to let thousands of new starters fall through the cracks due to a loophole.
How does the furlough scheme work?
<strong>ANY UK organisation with employees can apply, including businesses, charities, recruitment agencies and public authorities.</strong>
It’s up to your place of work to apply to the scheme, meaning you won’t need to contact the government yourself.
To access the scheme, your employer must comply with the following:
- Designate employees who cannot do their jobs due to the coronavirus measures put in place by the government
- Notify those employees of their new “furloughed” status
- Submit information to HMRC about furloughed employees to set up a system for reimbursement and about existing systems that will facilitate payments
To be furloughed, you must now have been on a payroll on March 19.
Workers can ask previous employers to rehire and furlough them, even if they left for another job, but firms don’t have to do this.
Experts believe that the clause is likely to have been added to stop fraudulent claims from employers for existing staff members.
James Froud, head of employment at law firm McCarthy Denning, said: "Whether intended or otherwise, there is no doubt that the RTI requirement will severely restrict the numbers who benefit.
"It seems likely to be relevant to little more than 15 per cent of all employees, i.e. those paid weekly or fortnightly.
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Kevin Mountford added: "I think there is still time to see an extension of the scheme, however, the next few weeks will be crucial.
"The Government are adapting as quickly as possible so I remain positive we could see this happen."
The Treasury wouldn't tell The Sun whether it is considering changing the guidelines to include theses workers who are missing out on the support.
A spokesperson said: "Our Coronavirus Job Retention Scheme is protecting thousands of jobs up and down the UK – with the Government covering 80 per cent of the salary of furloughed workers.
"The scheme opened on Monday morning and by midnight 185,000 firms had submitted claims worth £1.5 billion for 1.3 million employees."
New starters who miss out on the scheme can ask their previous employer to rehire them in order to be put on the furlough scheme.
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But this isn't compulsory and many employers are choosing not to do so.
We've put together a guide to how furlough affects you, including our pay, annual leave rights and how it works if you're on maternity or sick leave.