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Furlough and childcare vouchers

(17 Posts)
OneForTheRoadThen Fri 07-Aug-20 14:47:27

I work for a very small company (fewer than 50 employees) and was furloughed in March. I was told that the company was no longer required to let me continue with my childcare vouchers so I've had these stopped.

I'm now being brought back to work one day a week for the next couple of months. Where do I stand with regards to childcare vouchers? I've had to put my children back in nursery ( nursery is giving notice to anyone who hasn't returned by 1st August) so I would really appreciate being able to claim them again.

I'm the only person in the company who claims them so can't help feeling I'm at a bit of a disadvantage compared to other furloughed workers. Is this justified? TIA

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GeorgieTheGorgeousGoat Fri 07-Aug-20 14:50:25

If you’ve stopped paying in to the scheme altogether you probably won’t be able to restart. Check out Tax free childcare instead now.

OneForTheRoadThen Fri 07-Aug-20 15:55:05

No, it's possible to take a break from paying childcare vouchers and still stay in the scheme Georgie

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Evilwasps Fri 07-Aug-20 16:00:55

I don't understand this. I thought childcare vouchers were a salary sacrifice scheme therefore don't cost the employers anything, except the time to set up initially with whatever voucher provider they use. I might be wrong about that though.

I've been able to get childcare vouchers throughout furlough, but reduced them down to £1 a month as I obviously wasn't paying for childcare when it wasn't available.

I would have thought you can get the vouchers up to the max amount, salary dependent

OneForTheRoadThen Fri 07-Aug-20 16:04:51

I don't understand either evilwasps. Hoping someone from HR can clarify for me before I go back to them.

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Feminist10101 Fri 07-Aug-20 16:20:09

Depends on the scheme terms. Usually you have a log in to manage your own account. So what have you asked them to do?

OneForTheRoadThen Fri 07-Aug-20 16:27:06

Feminist I've reduced it to £10 a month as that the lowest amount you can get. Work said that's all they will cover. I normally get £245 a month but twirl have said they wouldn't cover that

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GeorgieTheGorgeousGoat Fri 07-Aug-20 17:37:46

OneForTheRoadThen

Feminist I've reduced it to £10 a month as that the lowest amount you can get. Work said that's all they will cover. I normally get £245 a month but twirl have said they wouldn't cover that

Ok we’ll that’s not what your OP said hence my first post. Which still stands. If you come out of the scheme you can no longer rejoin. But you haven’t as you’re still paying in.

However in your situation if your work will no longer up the amount, then TFC might be your best option as that’s managed by you have you can just pay in using your debit card.

OneForTheRoadThen Fri 07-Aug-20 18:00:07

Georgie with respect I don't really want to look into tax free childcare as I'm much better off with childcare vouchers hence why I use them. What I wanted to know is whether or not I've been misinformed about my eligibility for them while on furlough.

And yes you are correct in that once you exit the scheme then you lose eligibility but you only have to make one payment in 52 weeks to stay in the scheme so I won't be losing eligibility anytime soon which is why I asked my original question. Thank you for your reply but it doesn't help me with the questions I asked in my OP.

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flowery Fri 07-Aug-20 18:03:44

Benefits received under a salary sacrifice arrangement should not have been affected by furlough at all. The furlough calculation should have been done on your post-sacrifice pay, and the benefits provided as normal.

Furlough doesn't affect your entitlement to contractual benefits, only to pay, unless your employer seeks your agreement to withdraw a contractual benefit. Some have done that, on the basis they could no longer afford to provide them, as a way of avoiding redundancies. But they can't withdraw a contractual benefit arrangement without your agreement.

There's quite a useful example of furlough and salary sacrifice benefits here.

OneForTheRoadThen Fri 07-Aug-20 18:08:27

Thank you flowery I will have a read of that. I don't think my childcare vouchers were contractual though as there is nothing in my contract about them. I just asked if they would consider providing them, they agreed and set up an account with a provider.

When furlough started they said there was no official government guidance so they didn't think I could still claim them. I'm know the guidance was updated but I'm not sure if my work do. Am I able to claim any vouchers for the missed months?

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flowery Fri 07-Aug-20 18:20:15

"I don't think my childcare vouchers were contractual though as there is nothing in my contract about them. I just asked if they would consider providing them, they agreed and set up an account with a provider."

I assume it was a salary sacrifice? That is a contract variation, so you agree to reduce your salary and receive a benefit (in this case childcare vouchers) instead. The fact it wasn't in your original contract doesn't mean it isn't contractual. Did you get a letter reducing your salary and confirming the childcare vouchers amount? That would have been a contract variation.

A contractual benefit isn't something your employer decides whether or not you can 'claim' - it's a benefit your employer provides to you., unless and until your contract is varied again, to end the scheme, reduce it, revert to full salary or whatever.

Whether you should have been provided with the vouchers (and are therefore still owed them) depends whether your contract was varied at the time they stopped giving you them.

What does your furlough agreement say? Anything about the vouchers?

OneForTheRoadThen Fri 07-Aug-20 18:25:39

Thanks again flowery you are so helpful. I will dig out my furlough agreement and see what it says. I don't think it said anything about childcare vouchers.

We did get an email that offered us 3 options to changing our pension contributions (also salary sacrifice) and we had to pick one but the only correspondence about the childcare vouchers has been them emailing me to say they'd cover me for the minimum contribution (£10) for a couple of months and me thanking them. I hope this hasn't been interpreted as me agreeing to a contract change.

I've emailed them to clarify and will see what they come back with but I'm significantly worse off because of this so it's very frustrating.

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flowery Fri 07-Aug-20 18:37:41

"the only correspondence about the childcare vouchers has been them emailing me to say they'd cover me for the minimum contribution (£10) for a couple of months and me thanking them. I hope this hasn't been interpreted as me agreeing to a contract change."

It's not for them to graciously agree to 'cover you'. Your furloughed salary would have been 80% of the post-sacrifice amount, so you have paid for those vouchers already, and are entitled to receive them. So if, for example, your pay before you started receiving vouchers was £2000 a month, and then you agreed with your employer to reduce your salary to £1750 a month and get £250 a month in vouchers instead, your furlough pay would have been 80% of £1750, not £2000.

It does mean it costs them slightly more, as obviously HMRC doesn't fund 80% of the childcare vouchers. But that isn't your problem to solve, that's just the way it is. I can't see that you thanking them when they've misled you into thinking they were entitled to unilaterally withhold a contractual benefit would constitute sufficient consent to the change, no.

OneForTheRoadThen Fri 07-Aug-20 18:40:36

Thanks great, thanks so much flowery. I'll see what they say when they get back to me. You've been so helpful thanks thank you

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MumUndone Fri 07-Aug-20 19:03:27

But with salary sacrifice there is normally a reference salary, which is your pre-sacrifice salary. They may have worked out 80% furlough payment based on that.

OneForTheRoadThen Fri 07-Aug-20 19:16:08

Flowery and Mumundone I have just looked and they have calculated my furlough pay as 80% of my gross monthly income before I've paid out for childcare vouchers so it looks like they don't owe me any vouchers.

But it seems like they shouldn't have stopped the vouchers without asking me. I'm a bit confused now.

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