Another Furlough Dilemma wwyd?

[Iwantmychairback]

I am a company accountant, been there for 18 years. Work a three day week usually. Fairly happy with the job, not really looking to move on.
I have two assistants. One does purchase ledger tasks, the other ‘B’ does credit control and wages.
One director. The director and ‘B’ have known each other 20 odd years, they are both married to other people, but are friends outside work.
When our company closed 2 weeks ago the director furloughed me, but kept ‘B’ on to do HR stuff and wages. She is being paid full pay but only working 3 days.
The director has emailed me a couple of times asking about work related stuff. No problem happy to help where I can. Today, he asked me to set up a payment, again, no problem, it will take me ten minutes.
However, he is also asking about the VAT return which has to be done by the end of this month. ‘B’ has never, ever done it and wouldn’t know where to start. There is perhaps, 5 days work for someone in order to get an accurate return submitted. It’s not something I can do from home, as I need access to the physical paperwork, not something I can teach anyone to do over the phone.
I’ve not yet replied to his email as I don’t know how to reply if he now asks me to go in to do it. On one hand, I want to keep the company going, and this will help, on the other I am so, so, so annoyed that he put friendship over practicality at a time like this. I can easily do 100% of ‘B’s job, she can do 20% of mine....
Wwyd if he asked you to come in in this situation?

5 days work for a VAT return? Really?

Why on earth did he furlough the finance manager? The vat return could probably be deferred. Once you've been off for three weeks he can unfurlough you for a week to do the vat return and then re-furlough you if necessary. Even if the vat return was late any fine from HMRC is likely to be less than furlough pay reclaim.

As I said, this is tricky. A business closes, temporarily for Corona. Say a big manufacturing firm, or a small florist, or a beauty salon. So no money coming in. So ideally you want to furlough staff. Because that's the right thing to do.

But people need paying. It's PAYE year end. P60's and then P11d's.

And people need payroll done every month. Some employees are still paid, in some industry's weekly. So who is running the weekly payroll?

Who is going to go onto the furlough portal? That's gonna be a laugh. NOT! Million's of employers? Getting their book keeper/finance person to try and get them on the furlough portal.

But who is going to do that? You can't furlough the book keeper? Because they are still working. But you want to furlough them. Because your business is closed so you've got no income.

Tricky!

One of the few people we haven’t furloughed is our main operational finance person. We’re obviously still paying people. So yes this does seem like a strange choice in the first place.

I've now been advised:

You are allowed to carry out statutory duties only, so wages, p60's, vat return, etc. But nothing that will generate a profit.

@Oblomov20 that doesn’t sound like any of the furloughing guidance I’ve seen, it’s very clear you’re not allowed to do ANY work for your employer during a furlough. Nothing.

Like the op I am an FD in manufacturing. However, we have furloughed our support staff. Management team still working with 20%pay cut.

Every non a accounts MD I have worked for seems to assume you can train anyone to do the job with a couple of screen shots.

If it was that easy we wouldn't take exams for years.

Good luck OP

Quite Topcat.
People seem to think accounts is soooo easy!!

Look I don't know what the answer is.
The guidance is clear:
Furloughed staff should do NO work. Nothing. For three weeks and then they may be allowed back.

Let's be honest here, that guidance is general guidance for Joe public who need it in very simplistic terms.

you are either working or furloughed.

so to a previous poster who said you're not supposed to work / do nothing?

my question still remains? really? So who is going who is going to do the payroll for the 25 million paye employees?

Or someone who does payroll or a finance director or a finance manager or someone.

This is a quote:

Att.org.uk:

It relates to directors. Who still have statutory obligations.

Don't you think that applies to finance who have to do the payroll? The portal? Submit accounts etc?

"The key consideration is what work the director can do while on furlough, given that any company has ongoing statutory obligations with which it must comply. Companies with two or more directors could choose to furlough some, but not all of their directors, leaving those remaining in work to carry out on their normal duties and ensure that the company‘s statutory duties are complied with. Where a company has only one director (such as a PSC), or furloughs all their directors, the guidance permits a furloughed director to carry out particular duties to fulfil the statutory obligations they owe to their company. However, a furloughed director should not do no more than would reasonably be judged necessary for that purpose and they shouldn’t do any work which generates a commercial revenue or provides services to their company, so they will be very limited in terms of what they can do. This may be challenging for some owner managed businesses who are hopeful of continuing to be able to do some work during the coming months in order to keep their business going."

What's your solution? Re who should do the payroll and portal?

Buffalow

Do who is going to pay the employees then?

Furloughed staff should do NO work. Nothing. For three weeks and then they may be allowed back

These are the rules.

A director is not the same as a finance manager

Do who is going to pay the employees then?

If the OP is asked to do this then she is not furloughed, is entitled to full salary and if the employer claims the furlough then they are acting illegally.

So where is the company going to get the money from?

To pay the person running the payroll?

The company has no income. But the government are requesting that companies encourage non essential staff to 'stay home'. So these staff have been furloughed.

So the company will get 80% of their wages back. From the portal.

But you are not going to furlough payroll staff?

So where is the company going to get the cash flow? To pay the payroll person. When they are closed and therefore there is no income for the company?

Am I being dumb?

Where is the money going to come from to pay the payroll staff?

Do what about the millions of uk companies who don't have good cash flows?

Their banks still need checking and reconciling. Submitting companies accounts. Payroll. Portal. Statutory reports.

But you can't furlough the staff who do all this work.

So you can't claim back 80% of their wages.

So where does the money come from? To pay the staff doing these finance jobs?

Are you saying the company have literally nothing in the bank? Then they probably need to close. Or apply for a loan.

Many small companies would struggle after a month of no income.

If you are an accountant, or an agent with lots of clients, you'd know that payroll is often a large % of many small companies P&L costs each month.

Why can't these finance staff work from home?

Officers (directors) of a company have statutory duties to fulfil. Employees (whether finance or not) don't.

Or sorry, rather how small the company is, what their cash flow is like, maybe isn't my issue here?

Maybe I'm wording it wrong? Asking you all the wrong question?

So, is it suggested that finance people, who do the payroll, (etc, and others who do finance stuff for all companies) aren't furloughed.

The business will have enough money. To pay them for the next 3 months. Until Corona is over?

Many small companies would struggle after a month of no income then they can apply for a business loan.

Work from home?
So they are still working.
Not furloughed.
So their salary can't be claimed back from the portal.
Because they aren't furloughed. They are working.
So let's hope the company has enough money of its own, already, to pay these staff?

The business will have enough money. To pay them for the next 3 months. Until Corona is over?

The furlough scheme finishes at the end of May.

Have you tried applying for a Corona business interruption loan?

Many companies have had their applications refused.

I don't know what you want people to say. If the company can't afford to pay staff and can't get a loan, then it will have to close.

Really sad but unfortunately the reality for lots of small and not so small businesses.

Finishes end of May? Is that under the assumption that Corona will be over by then?

What if it's not?

Anyway whether Corona lasts for ages, or not, the suggestion is that payroll staff and other finance staff, aren't furloughed?

Interesting.

Finishes end of May? Is that under the assumption that Corona will be over by then?

The Chancellor said it was a 3 month scheme starting March 1st. I doubt they will extend it.

Fair enough Tony.
Global epidemic. And the government wants people to 'stay home'.

Stay home. We'll make sure you are paid. Just until this is all over. Then we'll sort out later, how we are gonna claw it all back. Say the government.

In order to stop redundancies and companies going into administration a portal is suggested.

But we won't furlough the staff who do the work to access the portal.