06 Apr 2020 9:37 AM

HMRC has published an important update to the Coronavirus Job Retention Scheme which has clarified some aspects of the scheme, and confirmed and changed other aspects. There are also new changes added.

Here we highlight the main points:-

CLARIFIED: employees can start a new job when on furlough (meaning they might end up earning 80% of the old salary and 100% of a new one).

This was not prohibited in the earlier guidance, but the new guidance expressly allows it. The guidance does say it has to be allowed under the old employment contract, but presumably the old employer can waive that.


CLARIFIED: an employer can reclaim 80% of compulsory (presumably meaning contractual) commission back from HMRC, as well as basic salary.

This is good news for car salesmen and estate agents. But it can only be referring to the commission from past sales as the furloughed employees cannot be completing new sales when on furlough.

CHANGED: employers can reclaim 80% of fees (whatever that means) from HMRC.

The previous guidance said they could not.

CLARIFIED: the 80% does not include non-monetary benefits (eg the value of health insurance or a car).

CLARIFIED (although we all knew this anyway): Company directors can be furloughed.

They can still perform their statutory duties, but not other work for the company.

CONFIRMED: Employees can be furloughed multiple times,

ie they can be furloughed, brought back to work, then re-furloughed (subject to each furlough period being at least three weeks)

NEW: Employers must notify employees of their furlough status in writing

Tthe previous guidance did not require it be in writing. Employers are required to keep the record of that written notification for five years.


Lots of areas remain unclear. For example:-


Q. What do 'statutory duties' actually cover for company directors?

Q. Are employees who TUPE into a business after 28 February covered? (It is thought not)

Q. Can employees take annual leave when on furlough? and what should they be paid?

We will be keeping a watch on developments to the scheme as they are announced and will publish any updates and guidance. 

If you have any questions about the scheme please email your usual Alliotts partner or contact me.

For more information relating to COVID-19, please view our COVID-19. Information Quick Find page