Many are welcoming the new Extended Job Retention Scheme. However, is the new 14th of the month following deadline a ‘cause for concern’?
Full guidance for the extended CJRS will include further detail on how to claim and will be published on Tuesday 10th November 2020.
The current policy paper provides information along the following lines:-
Background – Claiming the extended CJRS
The extended CJRS operates similar to the flexible furlough scheme, in several respects. Employers claiming grant must:
- report and claim for a minimum period of 7 consecutive calendar days
- report actual hours worked and the usual hours an employee would be expected to work in a claim period
- for hours worked, pay employees in accordance with the employment contract and be responsible for paying the tax and NICs due on those amounts
The claim period
The claim period must start and end within the same calendar month: if the pay period includes days in more than one month, separate claims will need to be submitted covering the days that fall into each month. Each of those claims will need to be calculated separately. Claim periods cannot overlap, and employees claimed for will need to be included in each separate claim made.
Claim in arrears or in advance
An employer can make a claim in anticipation of an imminent payroll run, at the point they run their payroll or after they have run their payroll.
Initially there is a short period when the legal terms of the scheme and system are updated. Businesses will need to claim in arrears for that initial period at least. There is no gap in eligibility of support between the previously announced end-date of CJRS on 31st October 2020 and this extension starting 1st November 2020.
When can the first claims commence?
Employers will be able to claim from 8am on Wednesday 11th November 2020. Claims can be made:
- in respect of an employee for a minimum 7 day claim window
- in advance
- in arrears for the period from 1 November 2020 to 11 November 2020
Claim deadlines
The closing date for claims the former Scheme up to and including 31st October remains as 30th November 2020.
HMRC state that – Claims relating to November 2020 under the new extended scheme must be made by 14th December 2020.
Claims relating to each subsequent month should be submitted by day 14th of the following month, to ensure prompt claims following the end of the month which is the subject of the claim.
November 30th deadline
Many employers and payroll are reliant on hours worked. Ole thin and payments in arrears to manage variable pay, prominent especially for part time and zero hours workers. Overtime and additional hours can be worked at late or little notice with time sheet collection and time lag to payment.
A number of employer missed the original pre flexibility deadline of 31st July. Flexible furlough brought into play the concept of usual hours and need for accurate collection of worked hours. The final. Slim point for flexible furlough is 30th November 2020. With mid month hours collection and payroll processing, will the data be accurate, free from correction and in time for employers to both finalise calculation of furlough grant claim.
Then there are the challenges of multi payroll frequencies, and even monthly frequencies that do not match calendar months precisely.
At least this deadline was declared at the beginning.
Deadlines for extended CJRS – monthly by 14th!
Employers and especially payrollers will now be in a panic of how they can:
- Collect accurate time worked data in time
- Accurately calculate extended CJRS claim amounts
- Hands the inevitable adjustments due to adjustments or changing circumstances
For some employer scenarios, are the timeline so tight as to be impossible. What is critical is that if deadlines are missed, the U.K. PLC has missed out on valuable job support for what are likely to be the most vulnerable workforce groups.
And this same stress test will repeat over each month of extended CJRS operation.
Is it time to panic?
It’s certainly time to plan. Either the whole business needs to work together to ensure that timely and accurate data is achieved over the next months, else significant lobbying needs to take place to bear pressure for more relaxed deadlines.
Action needs to be taken quickly, else many employers are going to be paying monies in good faith without a means of recovery.
Is it time to panic?
PAYadvice.UK 6/11/2020
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