Furlough Question

[Horsemad]

If zero hours people are being furloughed part way through the month, which month do you use to check back for their pay last year when working out the average pay please?

Either February just gone, or if they have worked for you for more than a year, the average of year 2019/2020, whichever is the highest amount.

@twoheaped thanks for replying.

Use Feb last year, even if being furloughed in April?

February 2020.
Furlough can be back dated to March 1st, which is why it is February.

You do have to pay the higher amount of annual average earnings or February 2020.

Our business is seasonal, our zero hours furloughed worker will be getting the average of her annual earnings as it was more than the February.

Hmm, confused now because on the .gov website it says:

Employees whose pay varies
If the employee has been employed for 12 months or more, you can claim the highest of either the:

same month’s earning from the previous year
average monthly earnings for the 2019-2020 tax year

Surely that'd be Feb 19? 🤔

If you were furloughed in April, it would be the higher of April 2019’s earnings or the average from April 2019-March 2020.

Hi horse.
They'd be paid the part of March 20 they worked as normal, plus the part they were furloughed at 80% of the higher of March 19 OR 2019/20 average (presumably to February 20?).
Then April 20 (assuming still furloughed) would be 80% of the higher of April 1o or 19/20 average.

In wondering how it works if you are paid a month in arrears, ds1 was paid for February hours in March, and worked some hours at the beginning of March which will be paid in April. No idea if they are furloughing or just not giving hours, but if furloughing how will that work when they are open again and he has to work 2 months before being paid. Doesn't matter for him (A'Level student living at home) but would for others.

Yes, that's how I thought it would be calculated @MintTeaLady, thanks.

Hi Chasing 👋 the person who asked me this question is likely to be furloughed this week, so they've already been paid for Mar 2020 and as MintTeaLady suggests, I think the comparison month from last year would be Apr, as that's the month this year that they'll most likely be furloughed.

Hopefully this will be the correct answer!🙂

Mine was worked out on my average wage over the last 12 weeks (from date of furlough start)

Confused about this too - we have someone who has reduced her hours from 33 pw to 24 pw at the start of this year. Do i now have to base her 80% on her full time salary? That would be ridiculously unfair on everyone else!

@SheSaidNoFuckThat - how long have you been employed? I think the method used for you is for when people haven't been employed for a whole year - in those cases, I think it says to do an average of the length of time they have been employed.

@Blobby10 - think it's pro rata'd in that situation?
So an average of f/t and then of p/t?

@Blobby10, sorry 33hrs and 24hr, not f/t or p/t.

@Horsemad 7 months, but all zero hour contracts have been done the same in my work

So yours was worked out from 1 Mar 2020 for the 3 mth period then @SheSaidNoFuckThat?

It is quite confusing, I have to say!

@Horsemad they used 12 weeks beginning 23rd December. Then worked out the average, we get 80% of that

SheSaidNoFuckThat that doesn't appear to agree to the rules - 80% of the higher of (i) pay for the same period last year and (ii) 2019/20 average, with other rules for where the employee wasn't on the payroll for the same period a year ago.

It probably comes from the way holiday pay calculations have been done for employees who don't work the same hours every week, but doesn't agree with the furlough regulations.
Make sure you are being paid enough, if they are paying you more that's very generous of them - as they will no doubt find out when they apply for the grant.

Blobby10 you base it on 80% of the higher of (i) her pay for the same period last year and (ii) her 2019/20 average.
In this situation she would appear to be advantaged by the reduction in hours. But it isn't unfair to other employees as such, they still get their furlough pay based on their hours so they aren't losing out.

@SheSaidNoFuckThat
I have a zero hours employee. We have furloughed her from the beginning of March.
We looked at her wage for March 2019 and from March 2019 to April 2020. Her annual average was more than the month of March, so she gets 80% of that.

@Chasingsquirrels I wasn't working there a year ago, it's the sort of business that has a high staff turnover so a lot would be in the same position. We have actually been paid 2 weeks at full "average" and then go on to the 80%

SheSaidNoFuckThat as I mentioned there are specific rules for employees who weren't employed a year ago.
It's good that they've paid you 100% for 2 weeks, but ensure that you aren't missing out based on the below calculation once you go to 80%.

From HMRC guidance.
If the employee has been employed for less than 12 months, claim for 80% of their average monthly earnings since they started work.

Yep, Chasingsquirrels is right - mind you don't get short changed @SheSaidNoFuckThat. You should get 80% of your average wage of the 7 mths you have worked there.

@Chasingsquirrels I will go over my payslips and see how it works out, thank you

If you look at your March 20 pay slip it will have year to date totals on it (for that job). Use that figure and divide by the time you've been there.

Remember to use your gross pay amounts. 🙂

All good, works out about the same, thank you again though