Furlough Clarifications: Holiday, Maternity Leave & SSP

Gary Green
Gary Green
April 20, 2020

As soon as the scheme was announced, accountants and employment lawyers started asking for furlough clarifications. In particular, the rules around holiday, Maternity Leave and sick pay were not clear.

In today's article we're going to dive into some specific furlough clarifications.

For more on furlough small print, you may find our article Furlough - Legal Considerations helpful. And if you’d like more information about the financial, political and tax changes so far, check out our Coronavirus Tips. And be sure to visit our Coronavirus Update page.

Holiday While On Furlough

Staff on furlough are still employed. As such, they continue to accrue holiday allowance in the normal way. Under Working Time Regulations holiday allowance (at least up to the statutory minimum of 5.6 weeks per year) will continue to accrue.

The same rules apply for continuous service. Because the employee is still on the books, continuous employment accrues during furlough.

The rules around actually taking holiday (and what pay would result) during furlough are not clear. We recommend talking to your HR department for clarification. If you would like to speak to an employment law specialist, we would be happy to make the introduction - please get in touch.

Maternity Leave

Furlough doesn't affect the health and safety rules. If a member of staff has a baby, she MUST take, immediately following the birth, a minimum of:

  • 2 weeks leave
  • 4 weeks leave (if she works in a factory or workshop)

As a business owner, you can claim for enhanced maternity leave through the furlough scheme. You would reclaim SMP as usual and then claim any enhanced payments via the Coronavirus Job Retention Scheme. Currently, employers can claim:

  • 92% of SMP
  • 103% of SMP (if they qualify for Small Employers' Relief)

You may like to speak to a tax expert to make sure you are organising your payments in the most efficient way (while staying fully compliant).

Sick Leave & SPP

According to the government's official guidance page:

Employees on sick leave or self-isolating should get Statutory Sick Pay, but can be furloughed after this. Employees who are shielding in line with public health guidance can be placed on furlough.

This would suggest that, if staff members are currently off sick, you should wait until they come off sick leave before placing them on furlough. It is not clear what the difference between "self-isolating" and "shielding in line with public health guidance" is.

Either way, it would seem that an employee would have no reason to say that they are sick. SSP is almost certain to be lower than furlough pay.

At the moment the rules around furlough and its alternatives are changing daily. We'll have more information as soon as it becomes available. Be sure to check our blog for updates and keep an eye on the HMRC Coronavirus Job Retention Scheme page.

If you'd like to discuss your options during the coronavirus crisis, please get in touch. We are staying on top of all the announcements from the government and can help you navigate this challenging time.

Interested in our services?
Fill in your details and a member of our experienced team will be in touch shortly to discuss your needs.
We adhere to strict GDPR rules and do not reveal or sell your data to any third-parties. For more, please read our Privacy Policy.
Latest Insights
May 26, 2021
The Most Common Tax Breaks for Small Businesses in the UK

A significant number of small businesses in the UK do not take full advantage of HMRC-approved...

May 24, 2021
The Complete Small Business Checklist for Hiring Your First Employee

There are a multitude of rules and regulations that you must be aware of when you...

May 21, 2021
Dealing With a Deceased Person's Estate - With or Without a Will

Everything you need to consider when dealing with a deceased person's estate and paying the relevant...

May 19, 2021
All You Need To Know About Workplace Pensions

A workplace pension is a pension scheme offered to employees by employers. Some workplace pensions are...

May 17, 2021
Tax Rates, Thresholds & Allowances for Employers in 2020-21/2021-22

All the tax rates, thresholds and allowances set by HMRC that employers should be aware of...

May 14, 2021
How to Fill Out a PAYE Settlement Agreement (PSA) Form: P626 & PSA1

A PAYE Settlement Agreement (PSA) allows employers to make one annual submission and payment to cover...

May 13, 2021
How Easy Is It to Get Funding as a Startup in the UK?

Financing a new startup business is one of the most crucial aspects of helping a new...

May 12, 2021
Benefit in Kind (BIK) Tax Rates: Calculating Tax on Employee Company Cars

The tax benefits of driving a company car have been steadily reduced over many years. Most...

May 11, 2021
The Essential Guide to Tax Relief Rates on Pension Contributions

You can claim tax relief for your private pension contributions worth up to 100% of your...

View Our latest insights »
Get the latest UK tax & business news and guidance delivered straight to your inbox
We care about the protection of your data. No spam. Unsubscribe anytime.
Copyright © 2021 Key Business Consultants LLP. Reg: E&W OC389322
linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram