The Flexible Furlough Scheme

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The Government announced that the Coronavirus Job Retention Scheme (or “Furlough Scheme”) will change from 1 July and will end on 31 October 2020. The Furlough Scheme has changed so that employers will begin contributing to furloughed staff wages as Government intervention is steadily withdrawn over time.

It is still possible to “fully furlough” staff, up until the end of the Furlough Scheme. However, from 1 July the changes mean that staff can become to return part-time if there is the work available for them to do.

Changes from 1 July

You can only furlough staff who have been previously furloughed.

Staff who have been furloughed up until 30 June 2020 can be furloughed. The cut-off date, therefore, with the three-week minimum furlough period is 10 June 2020. You cannot furlough any new staff under the new scheme which comes in to force on 1 July 2020, other than if they are returning from statutory family leave for which further government guidance is awaited.

Furloughed employees can now work part-time.

Previous to 1 July, no furloughed employee could work for their employer whilst on furlough. If they did, the employer risked having their CJRS claim denied.

From 1 July, furloughed employees can work on a part-time basis and the employer can claim the difference of their earnings from HMRC.

Worked Example

If you have a staff member who typically works a 40 hour work week and you are only able to offer them 16 hours per week, then the employer is responsible to pay the employee 16 hours per week at their normal pay and can claim 80% of the outstanding balance of 24 hours per week from the government.

Furlough until 30 June

Jennie typically works 40 hours per week x £10 per hour = £400 per week (inclusive of employer’s NI and pension contributions).

Three weeks minimum furlough = £1,200.

80% of £1,200 = £960 claimed from HMRC.

Furlough 1 July – 31 July 

Jennie typically works 40 hours per week x £10 per hour = £400 per week (inclusive of employer’s NI and pension contributions).

Jennie is asked to return to work for 16 hours per week because the nursery she works at is opening in part.

Therefore, Jennie will be paid by her employer in full for the time she works:

16 hours per week x £10 per hour = £160 per week.

Her employer will be able to claim for the balance between what she has actually worked and what she usually would have worked but for the nursey opening only in part:

24 hours per week x £10 per hour = £240 per week.

80% of £240 = £192.

Therefore of the £400 Jennie would typically earn in a week:

  • £192 will be reclaimed from HMRC under the CJRS
  • £160 will be paid by her employer for the hours she has worked.

The remaining £48 can be topped-up by the employer but it doesn’t have to be.

If you change the working pattern of your staff you must detail the new hours/working pattern in writing and gain your staff’s consent before they start working the new pattern.

Any hours that remain furloughed hours are non-working and the employee must not do any work for the employer during this period.

The minimum claim period is now seven days.

Prior to 30 June, the minimum claim period was three weeks.

From 1 July, the minimum claim period is seven days unless the last or first day of the month is included in the period and you claimed for the period immediately before, due to the claims having to be concluded by the end of the month.

However, this does not mean that an individual has to be furloughed for a minimum of seven days to receive the grant – there is no longer any minimum furloughed period.

If you change the working pattern of your furloughed staff from full to part-time furlough you must evidence this in writing and keep this evidence for at least five years.

Any change made to the way in which your employees work is considered a variation to their employment contract. The employee must consent to this change and such change must be evidenced in writing.

We suggest issuing a letter to your employees explaining their new working pattern and why you wish to make this change. You should then provide them with a variation to contract document for them to sign and return to you.

The flexible furlough agreement and variation to a contract must be kept for at least five years. If you change the pattern again during the flexible furlough scheme, you will need another agreement.

If you would like a precedent to use to ensure the changes you have made are carried out correctly and legally, we are offering access to our online template document portal which has over 100 documents covering over 14 employment law subjects (including a Flexible Furlough Agreement template) for just £125 + VAT.

The employer must start contributing

In July, the grant remains the same. However:

  • from 1 August, the employer will have to start covering the employer’s National Insurance Contributions and pension contributions again
  • from 1 September, the employer will cover employer’s NI, pension and 10% of wages
  • from 1 October, the employer will cover employer’s NI, pension and 20% of wages.

At all times if the grant is being claimed the individual must be guaranteed at least 80% of pay. The contributions are payable over the furloughed hours, irrespective of whether the individual is also working some hours at the same time.

Holiday rules remain the same

As under the current scheme, furloughed (and part-time furloughed) employees accrue holiday and may be asked to take it whilst on furlough (so long as their pay is topped up to 100% and proper notice is given).

You must keep extensive records for six years in case HMRC audits your claims for CJRS support.

You must keep a record of the following for six years:

  • the usual hours the individual would work during any claim period
    the hours the individual will work/has worked in any claim period
    the hours the individual was furloughed for in any claim period.

Do I have to use the flexible furlough scheme? Can I keep furloughed staff on furlough full-time until 31 October?

You do not have to use the flexible furlough scheme, it is an option only. If it is more suitable for your business to remain on furlough until the scheme ends, that is allowed.

Please keep in mind, however, that the scheme will change on 1 August, 1 September, and 1 October as the government reduces its support and employers are asked to contribute more to their employee’s wages.

Further information

For specific advice for your business, please get in touch with our specialist Employment Law team through this website or by calling 0330 404 0778.

For all of our COVID-19 (Coronavirus) advice, please visit

Our partners at Ashtons HR Consulting are also on hand to assist you.

This information is correct at 12pm on 19 June 2020.


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