The furlough scheme has been extended  to 31 March 2021.

You can bring furloughed employees back to work on a part-time basis or furlough them full-time. Employers must pay National Insurance and employer pension contributions. Employees will receive 80% of their salary for hours not worked up to a maximum of £2,500 per month.

Find out more on the government website.

New Job Support Scheme 

The new Job Support Scheme  has been postponed until the furlough scheme ends. The Job Support Scheme will aim to protect viable jobs in businesses that are facing lower demand over the winter months due to coronavirus. Under the scheme, which will run for six months, the government will contribute towards the wages of employees who are working fewer than normal hours due to decreased demand. 

Employers will pay the wages of staff for the hours they work. However, for the hours not worked, the government and the employer will each pay one third of their equivalent salary. Employees must be working at least 33% of their usual hours. The level of grant will be calculated based on the employee’s usual salary, capped at £697.92 per month. 

The Job Support Scheme will be open to businesses across the UK even if they have not previously used the furlough scheme. Further guidance about the scheme will be published by the government shortly. 

Read the NHBF’s response to the new scheme.


Job Retention Bonus: update 

The Job Retention Bonus will no longer be paid in February 2021 as the furlough scheme has been extended to the end of March 2021. We understand that the government will announce a new Job Retention Bonus scheme at the appropriate time.


Please note: this is a fast-moving situation and things can change from day to day. Always check back for the latest advice.

Don't fall for fraudsters and scammers

Fraudsters and scammers will be trying to take advantage of those who are anxiously waiting for financial support to come through. Be very wary if anyone contacts you via phone, email, post or text claiming to be from the government, HMRC or any other body such as a local council or bank. In addition, fraudsters have been registering websites with names such as 'Coronavirus Compensation Ltd' - use only the official website.

The government has published guidelines to help you avoid scammers and fraudsters during the coronavirus crisis. Do take the time to read it. It explains what correspondence you can expect to receive and how to tell if an email or text is fraudulent.


What is the government's coronavirus job retention scheme?

The furlough scheme has been extended until 31 March 2021.

You can bring furloughed employees back to work on a part-time basis or furlough them full-time. Employers must pay National Insurance and employer pension contributions. Employees will receive 80% of their salary for hours not worked up to a maximum of £2,500 per month.

Find out more on the government website.

Returning parents still eligible for furlough scheme

People on paternity and maternity leave who return to work in the coming months will be eligible for the government’s furlough scheme. This will only apply where they work for an employer who has previously furloughed employees.

Employees on adoption leave, shared parental leave, and parental bereavement leave are eligible. Find out more on the government website

Can my employees work part-time?

Salons and barbershops can now bring furloughed employees back to work on a part-time basis. This change has been in force since 1 July 2020. 

You can decide the hours and shift patterns your employees work. The government will continue to pay 80% of salaries for the hours your employees do not work. 

Find more information on the government website

The furlough scheme will remain open until the end of November 2020. Find more details about how it will work until then.

How do I apply to the scheme?

Check if you can claim on the government website.

Please note: 

  • Take the time to read the instructions in the step-by-step guide – don’t start your online claim until you have gathered all the information you need as set out in the guide.
  • Once you have made your claim you will NOT receive a confirmation email. You will see a claim reference number on the screen that you should make a note of.
  • Tell your employees that you have made a claim and that they do not need to do anything else.
  • HMRC will verify your claim and you should receive funds within six working days.
  • Keep all your paperwork, records and calculations relating to the scheme for five years.

To access the system and make a claim you will need: 

  • A Government Gateway ID and password.
  • An active PAYE enrolment.

If you do not have these, you can register for them at:

Remember: don’t be caught out by scammers and fraudsters – use only the government’s official online system to apply.

Which employees can I claim for?

Employers can claim for employees who were employed and on their PAYE payroll on 30 October 2020. The employer must have made a PAYE Real Time Information (RTI) submission to HMRC between 20 March 2020 and 30 October 2020, notifying a payment of earnings for that employee.

Who can claim under the furlough scheme? 

All UK businesses are eligible. 

What will I need to make a claim?

Employers will have to apply through HMRC via an online portal. To claim, you will need:

  • Your ePAYE reference number.
  • The number of employees being furloughed.
  • The claim period (start and end date).
  • Amount claimed (the minimum length of furloughing is three weeks).
  • Your bank account number and sort code.
  • Your contact name.
  • Your phone number.

You will need to calculate the amount you are claiming. HMRC will retain the right to audit all aspects of your claim.

What financial help will be available? 

Employees will receive 80% of their salary for hours not worked up to a maximum of £2,500. Employers must pay National Insurance and employer pension contributions. 

What about dividends? 

Dividend payments are not covered by the job retention scheme. This is because income from dividends is a return on investment in the company rather than wages and so not eligible for support under this scheme.

How far in advance can I claim my employees' wages?

You can claim up to 14 days in advance of their normal pay date.

What about my weekly paid staff?

If you have weekly paid employees you can submit weekly applications as applications are made per pay period. However, your employee must be furloughed for a minimum of three weeks to be eligible for the scheme.

How long after applying will payments be made?

Normally, payments will be made within four to six days of an application being made.

Do I have to declare this as income for tax purposes?

Payments received under this scheme must be included as income as part of your taxable profits for Income Tax and Corporation Tax purposes.

Do I have to top up wages to 100%?

Employers can decide whether or not they wish to top up the remaining 20%. They do not have to pay it.

You cannot claim for employer National Insurance or pension contributions on any amounts you pay over the 80% provided by the government.

What about the tax, National Insurance and pension contributions my employees normally pay?

While on furlough, your employees' wages will be subject to the usual income tax and National Insurance.

They will also pay their automatic enrolment pension contributions on qualifying earnings unless they have opted out of the pension scheme.

Can my claim for 80% of wages include past overtime, fees, commission or bonuses?

Our current understanding based on the latest government information is that it will be unlikely that you can include discretionary bonuses/commission payments, tips or ad hoc commission payments on product sales. 

However, it is likely that you will be able to claim for:

  • Regular commission payments on services.
  • Commission payments that are made as part of the contract of employment.
  • Past overtime.
  • ‘Fees’ (the government does not define what ‘fees’ are).

This is because the government has now stated that employers can claim back ‘any regular payments you are obliged to pay your employees’.

What if my employee's wages vary from month to month?

If your employee has been employed for a full twelve months prior to the claim, you can claim for the higher of either:

  • The same month’s earning from the previous year.
  • Average monthly earnings from the 2019-20 tax year.

If your employee has been employed for less than a year, you can claim for an average of their monthly earnings since they started work.

If your employee only started in February 2020, you will need to work out their earnings on a pro rata basis.

Once you’ve worked out how much of an employee’s salary you can claim for, you must then work out the amount of Employer National Insurance Contributions and minimum automatic enrolment employer pension contributions you are entitled to claim.

What happens if my employee works for someone else as well?

They can be furloughed for each job and each job is treated separately under the scheme.

Can my employee take on a new job while they are furloughed?

HMRC says that while an employee cannot do any work for the employer who has furloughed them, they can, in theory, take on work for another employer. This would mean they earn 80% of their wages from the first employer, and 100% of their wages from the new job. 

However: bear in mind that this will depend on what their employment contract says. Many contracts state that the employee cannot take on other employment without their employer’s permission.

What other help may be available for my employees?

Citizens Advice has provided the following links that may be useful for your employees if they are struggling financially before the 80% payments kick in:

Your employees can also read this government advice.

How do employers apply? 

Employers will have to apply through HMRC via an online portal.

What do employers need to do now? 

You will need to designate affected employees as ‘furloughed’. This means your employees are on a leave of absence. The minimum length of time an employee can be furloughed for is three weeks.

You must tell HMRC about the employees who have been furloughed using the online system. 

Write to your employees

You must write to your employers to explain what is happening and confirm that they have been furloughed. This must be done in a way that is consistent with employment law (see below). Keep a written record of all your communications. Employees do not need to send a written response. See 'Can I furlough all my employees?' below for links to letters NHBF Members can download. 

You will need to keep these records for five years.

Can I furlough all my employees?

If your employment contracts state that you can lay off staff (the NHBF contracts DO have this clause), then you can furlough your staff.

If your employment contracts DO NOT state you can lay off staff, you will need their agreement to furlough them.

Download a furlough letter to send to staff who DO have a lay off clause in their contract.

Download a furlough letter to send to staff who DO NOT have a lay off clause in their contract.

What about the National Minimum Wage and National Living Wage?

The government has confirmed that:

  • Employees are entitled to the National Minimum Wage (NMW) when they are working.
  • Furloughed employees are not working and so are not eligible for the National Minimum Wage during this time.

What are my employees and apprentices allowed to do while they are furloughed?


The government says:


During hours which you record your employee as being on furlough, you cannot ask them to do any work for you that:

  • Makes money for your organisation or any organisation linked or associated with your organisation.
  • Provides services for your organisation or any organisation linked or associated with your organisation.

Your employee can:

  • Take part in training as long as it is safe for them to do so and there is no requirement for the furlough pay to be topped up. See government guidelines. This does not apply in the same way to apprentices. See bullet point below.
  • Apprentices must be paid the NMW for any training they do while on furlough. The government guidelines say: Where training is undertaken by furloughed employees, at the request of the employer, they are entitled to be paid at least their appropriate national minimum wage for this time. In most cases, the furlough payment of 80% of an employee’s regular wage, up to the value of £2,500, will provide sufficient monies to cover these training hours. See goverment guidelines on this.
  • Volunteer for another employer or organisation.
  • Work for another employer (if contractually allowed). 

What is happening about apprentices in England?

Government information about apprentices in England 

The government has updated (19 May 2020) its guidance for apprentices, employers, training providers and assessment organisations in England. It includes information on training and assessment in line with safer working guidelines, calculating wages for furloughed apprentices, support for redundant apprentices and FAQs. Find out more.

England: Can I pause my apprentice’s training? 

There is no need to report or record breaks in learning of less than four weeks. 

Employers and learning providers can initiate a pause in learning if the break is related to the coronavirus outbreak and will be longer than four weeks. (Apprentices will still be furloughed and employers can claim 80% of their usual wages.) 

Breaks of longer than four weeks must be reported and recorded on the apprentice’s individual learning record (ILR). 

Payment to the training provider will be suspended for the duration of the break. 

The ILR must be updated when the apprentice resumes their apprenticeship training. 

How to pause an apprenticeship 

This ten-minute video explains what employers and training providers need to do when reporting a pause in learning of longer than four weeks. It includes an initial explanation then clear instructions from about half-way though. The video explains that you need to be careful about:

  • Ensuring you select ‘pause’ rather than ‘stop’ when reporting a pause in your apprentice’s training. If you select ‘stop’ this will end the apprenticeship.
  • The exact date when you pause an apprentice (otherwise the training provider may not be paid for training already delivered). Any payment made to training providers for training that was not provided in March due to the coronavirus outbreak should be used to provide training at a later date. 

What rights do furloughed employees have?


Employees who have been furloughed have the same rights as they did previously. This includes Statutory Sick Pay entitlement, maternity rights, other parental rights, rights against unfair dismissal and the right to redundancy payments.


Your employees' annual leave will continue to accrue while they are furloughed.


Can my employee do voluntary work while they are furloughed?


Yes, as long as this does not provide any revenue for your business.


What about employees who are off sick or self-isolating? 

These staff can be furloughed when they are again fit for work. In the meantime, they would continue to receive the Statutory Sick Pay and contractual sick pay they are entitled to. 

What about employees who are on unpaid leave or cannot work because they are caring for dependants due to coronavirus?  

HMRC has stated that employees who have caring responsibilities resulting from the coronavirus outbreak can be furloughed.

This could potentially include those on unpaid leave because they are at higher risk, or live with someone who is high risk, or have been laid off on nil pay or are on sabbatical.  

What happens about annual leave? 

Please note: This advice was updated on 20 April 2020 following clarification from the government and advice from our legal team.

Employees on furlough can take annual leave without disrupting their furlough. However, employers are required to top up pay to normal 100% levels for any holiday days taken during the furlough period.

Please note: While on furlough, employees will continue to accrue their statutory annual leave entitlement and any additional annual leave provided for in their employment contract. 

If you wish to instruct employees to take annual leave you can do so by giving notice that is twice the length of the holiday you require them to take (i.e. two weeks’ notice to take a one-week holiday). Please note that instructing employees to take all their annual leave during a lockdown period could affect the relationship of trust and confidence between you and your employee. Also, this could possibly be in breach of the Working Time Directive. Always speak to a legal adviser before forcing any holiday periods of longer than one week. 

What if my employee was on holiday when I furloughed other staff? 

Your employee will be entitled to their usual holiday pay until their booked annual leave comes to an end. They should then be furloughed.

Carrying forward annual leave

It has been announced that employees will not lose any annual leave they are unable to take during the leave year because of the coronavirus outbreak. Read our blog post about this.

The new regulations will allow up to four weeks (20 days for a full-time employee) of unused leave to be carried over into the next two  years. 

In normal circumstances, very little annual leave entitlement can be carried over. Employers are obliged to ensure their employees take their statutory entitlement to annual leave in any one year. 

What about employees on maternity leave, contractual adoption pay, paternity pay or shared parental pay?

The normal rules for maternity and other forms of parental leave and pay apply.

You can claim through the scheme for any amounts you normally pay in addition to the statutory pay for employees who qualify for:

  • maternity pay
  • adoption pay
  • paternity pay
  • shared parental pay

Furloughed workers planning to take paid parental or adoption leave starting on or after 25 April 2020 will be entitled to pay based on their usual earnings rather than the furloughed pay rate, the government has announced. 

This means that under the job retention scheme full earnings will apply to Maternity Pay, Paternity Pay, Shared Parental Pay, Parental Bereavement Pay and Adoption Pay. 

Find out more.

What happens to employees who are returning from maternity/paternity leave etc?

Returning parents eligible for furlough scheme

People on paternity and maternity leave who return to work in the coming months will be eligible for the government’s furlough scheme even after yesterday’s 10 June cut-off date for all other employees. This will only apply where they work for an employer who has previously furloughed employees.

Employees on adoption leave, shared parental leave, and parental bereavement leave are eligible. Find out more on the government website

Can employees be made redundant instead? 

The law says you must explore alternatives to redundancy as part of a fair process. Dismissing employees without attempting to use the furlough scheme and other financial assistance set out by the government is likely to be regarded as unfair. 

What if I have already made my employees redundant due to coronavirus?

Our legal team suggests that a conditional offer of re-engagement could potentially be made to the dismissed employee confirming that you will re-employ them on the understanding they will be furloughed. You can then apply for financial help under the job retention scheme.

The offer of re-employment should also confirm that if the application to the scheme is rejected for any reason you are under no obligation to pay the employee nor to provide them with work.

You are under no obligation to re-hire employees who were made redundant. If you are planning to re-hire employees, you must always take legal advice.

How will HMRC monitor the scheme (keeping records)?

HMRC will have the right to investigate claims made under the scheme – including for a period of time after claims have been made and paid. For this reason, make sure you keep all your documentation and records relating to your employees’ furlough arrangements for at least six years. Details about the information you will need to keep can be found on the government website.