HMRC has issued a further Treasury Direction on the Coronavirus Job Retention Scheme (CJRS), with a particular focus on the Flexible Furlough Scheme.

HMRC has issued a further Treasury Direction on the Coronavirus Job Retention Scheme (CJRS), modifying the effect of the previous Direction. The new Direction sets out the rules that will apply as of today, with a focus on the ‘flexible furlough’ arrangements.

We have summarised the most important points below:

• Time limit for making a claim under the original CJRS (covering the period until 30 June) must be made by 31 July.
• Claims under the “new” CJRS can only be made if an employer had previously made a qualifying CJRS claim (by 31 July) in respect of an employee who has been furloughed for at least 3 weeks on or before 10 June.
• Employees can now be flexibly furloughed – the wording of the Direction suggests that flexibly furloughed employees cannot work the full amount of their usual hours.
• It appears that employees can continue to be fully furloughed beyond 1 July.
• Agreement must be reached on flexible furlough arrangement. The agreement must be made before the beginning of the claim period to which the claim relates. It must be in writing and it appears that a letter from an employer together with a confirmation from an employee (including in an electronic form) would suffice. The agreement or confirmation must be retained by the employer until 30 June 2025.
• Claim periods starting from 1 July must start and end within the same calendar month and must last at least 7 days in that month.
• The Direction sets at length the details for calculating the reference salary and usual hours for the different types of workers. We would recommend that employers familiarise themselves with these.

Unfortunately, the Direction does not provide any clarity on some of the more nuanced points, such as an issue of notice pay (and PILON payments) whilst on furlough.

If you require tailored legal advice, please get in touch with our employment team.