THE furlough scheme is being extended until September, protecting workers’ wages while the Covid crisis continues.
The measures have saved more than 11million jobs since it was first put in place in March 2020.
The furlough scheme pays workers 80 per cent of wages for hours not worked, up to £2,500 a month.
However the scheme will change and from July employers will be asked to start chipping in.
Mr Sunak said businesses will have to contribute 10 per cent of the cost, increasing to 20 per cent in August and September as the economy reopens.
If you’ve been put on furlough, here’s how your pay will be calculated.
How is my furlough pay calculated?
Your employer can claim up to 80 per cent of your wages – to a cap of £2,500 a month.
That means that anyone who earns over £30,000 a month could see more than a 20 per cent drop in salary.
The calculation is done on your pre-tax salary – you will then have to pay tax and national insurance on it as normal.
If you earn a regular salary, you can work out how much you’ll get by calculating 80 per cent of your normal pay.
Your normal pay is defined by how much you earned in the last pay period.
If your income varies from month to month, for instance because you’re on a zero-hours contract, you can still be furloughed.
To calculate your pay, your company will use whichever is higher out of:
- Your earnings in the same month last year
- Your average monthly earnings for the 2019 / 2020 tax year.
If you’ve been employed for less than a year, your company can base the calculations on your average monthly pay since you’ve been in the job.
If you were hired in the last month, your bosses will calculate your pro-rata earnings and the furlough pay will be 80 per cent of that.
At the moment, bosses can only claim for furloughed employees that were employed and on payroll on October 30, 2020.
Employees being furloughed from May 1 until the end of September must have been on a PAYE payroll on March 2, 2021.
Your employer can choose to top up your pay, but they do not have to.
We’ve asked more information from the Government on whether you can get your furlough payments backdated and will update you as soon as we have more information.
When will I get my money?
You should continue to get your pay as you normally would.
Lots of businesses have been paying employees on their normal payday.
However, it’s best to check in with your boss if you’re unsure on when exactly you’ll be paid.
Once your employer has signed up to use the furlough scheme, furlough payments will be made six working days after the claim has been made.
Can I say no to being furloughed?
You have to agree to be furloughed, so technically you can say no when your employer asks you.
However, if you do say no your employer is allowed to make you redundant, which means you’d miss out on the 80 per cent pay.
However, you can also ask your boss if you can be furloughed if you’re struggling to balance work and childcare.
On the Gov.uk website, it says you can be furloughed if you’ve got caring responsibilities.
You can be furloughed if your caring responsibilities means you are:
- unable to work (including from home)
- working reduced hours
Crucially, it is up your employer to decide to furlough you. You should speak to your boss as soon as possible if you’re struggling.