I hope and trust this update finds you well as another busy month for us all nears completion.
As many of you are aware July offers employers and employees the opportunity to return from furlough on a part time basis. This update will focus around guiding you through this process and how you update NannyPaye of your changes. Later in July we will help you calculate the claim for the part time furlough grant (brace yourselves for another of our homemade calculators allowing you to quickly get your claim figure).
As always our advice is driven by published gov.uk guidance and the support of our own legal team.
Before we start may I also make a personal appeal to any employers who still have a payslip physically posted to their nanny. We have most of our team working remotely from home to avoid unnecessary travel and contact during this pandemic, a small skeleton team remain in the office to ensure the infrastructure continues to run smoothly. Usually the physical printing, folding and stamping of the payslips is divided amongst the whole team so we are finding the small skeleton team we do have in struggling to keep on top of the payslip dispatch.
If you can move to e-payslips for your employee (even if it’s only for a few months) it will greatly help. It simply takes a quick e-mail to firstname.lastname@example.org with your name (as the employer), postcode and employees email address, requesting to move to e-payslips.
Thanks in advance as it will make a huge difference.
Key Changes to Grant Payments
June 2020 – Any employer furloughing a nanny for the first time will have to have started that furlough from 10th June 2020 at the latest to qualify for a furlough grant (assuming all other criteria are also met).
July 2020 (a) – The government will continue to pay 80% of your employee’s wage (up to £2500 per month) for any hours not worked and any associated employer national insurance and pension contributions. Any worked hours should be paid at the normal rate (full pay) and you the employer will fund the full cost of these hours along with any associated NIC and pension.
Key Fact: HMRC are only helping with unworked hours they are not subsidising any hours your nanny actually works for you.
July 2020 (b) – The end of July is the last date you can make your first furlough claim for funds. If you have furloughed an employee and do not submit your claim in July you will not receive any funds. Please start this process as soon as possible to avoid delay due to unforeseen complications.
August 2020 - The government will continue to pay 80% of your employee’s wage (up to £2500 per month) for any hours not worked but not any associated employers national insurance and pension contributions. Any worked hours should be paid at the normal rate (full pay) and you the employer will fund the full cost of these hours along with any associated NIC and pension.
September 2020 - The government will continue to pay 70% of your employee’s wage for hours not worked (up to £2,187.50 per month), with the employer paying the extra 10% to bring the pay up to a minimum of 80% or £2500 per month minimum. The government will continue not to fund any associated employers national insurance and pension contributions. Any worked hours should be paid at the normal rate (full pay) and you the employer will fund the full cost of these hours along with any associated NIC and pension.
Key Fact: Even though the funding from HMRC is dropping you must still keep your nanny at a rate of pay no less than 80% for unworked hours.
October 2020 (last month scheme is available) - The government will continue to pay 60% of your employee’s wage for hours not worked (up to £1,875.00 per month), with the employer paying the extra 20% to bring the pay up to a minimum of 80% or £2500 per month minimum. The government will continue not to fund any associated employers national insurance and pension contributions. Any worked hours should be paid at the normal rate (full pay) and you the employer will fund the full cost of these hours along with any associated NIC and pension.
November 2020 – Furlough scheme will no longer be in place and employers should (leading up to this point) have discussed with their employee a return to work date.
Key Facts for Part Time Furlough from July 2020
- From July 2020, employers will be able to bring employees back to work from furlough on a part-time basis, whilst still being able to access the CJRS grant for any hours not worked.
- Employers can decide on the shift pattern or working hours they want an employee to work, but must agree this with the employee, and confirm that agreement in writing. (we have drafted a letter for you to use).
- Employers will need to report and claim for a minimum period of a week, but can do so for longer periods if required.
- Employers will be required to report the number of hours an employee has worked; alongside the number of hours they would have ‘usually’* worked within the claim period. This is the slightly intricate part and we will need to work together as a team to get your payroll and claim correct.
- The grant is calculated in proportion to hours that have not been worked, when set against an employee’s ‘usual’ working hours. This will make each payslip value different (if you are paying 80% for unworked hours) even if the agreed hours stay the same due to the changing working days in each calendar month.
- Employers will be responsible for paying employees for any hours they have worked, including the associated employer National Insurance (NI) and pension contributions.
- In order to qualify for the scheme from 1 July 2020, any employees, not previously placed on furlough, will have needed to have been furloughed by no later than 10 June 2020.
- From 1 July, claim periods can no longer overlap calendar months, due to the changes to the scheme.
Part Time Furlough Next Steps
Part time furlough is a great opportunity for employers to bring a Nanny back on exactly the hours they need. It may be your situation has changed subtlety from a requirement of no childcare to perhaps needing some core hours to aid your own return to ‘normal’. The hope is that these part time hours will then develop back into the original role by latest November so as to avoid redundancy. We hope that furloughed nanny’s will embrace this opportunity to return to the workplace.
Step 1 –Agree the new temporary working hours in writing with your Nanny. Please see our template letter linked here.
Step 2 (a) – If you have asked your nanny to return part time and are keeping unworked hours at full pay you do not need to inform NannyPaye.
Step 2 (b) – If you have not changed your arrangement in any way (e.g. staying on full furlough as per your June payroll) you do not need to inform NannyPaye.
Step 2 (c) – If you have asked your nanny to return part time and you pay her weekly please read the next step however also refer to the notes at the end *.
Step 2 (d) – If you have asked your nanny to return part time and are paying 80% for unworked hours you must tell us 4 key facts no later than 10th of each month. This will allow us to calculate the payslip for that month using the method outlined by gov.uk. Please just copy and paste the below into an e-mail to email@example.com :
- Your name as the employer.
- Your postcode.
- The total hours your nanny would have normally worked in that month**.
- The number of hours your nanny will work out of this total in that month***.
Step 3 – NannyPaye will confirm receipt of your e-mail and calculate the pay accordingly.
Step 4 – We will provide you with a calculator later on in July that will allow you to easily work out your claim amount from HMRC.
Step 5 – Due to the claim being based on a hybrid of potential hours in calendar month v’s annual salary you must repeat this process for each month your Nanny is part time furloughed.
*If you pay your nanny weekly please tell us as soon as possible when the part time furlough will start from and provide the total hours your nanny would have worked in a normal week set against the hours that will be worked. You will not need to repeat this process weekly unless it changes.
**Should your nanny work normally Monday to Friday for 10 hours each day for July this figure would be 23 days (Mon-Fri) in July x 10 hours per day = 230 potential working hours in July.
***Should you have asked your nanny to work 5 hours a day every Monday and Wednesday for July this figure would be 9 days x 5 hours per day = 45 actual worked hours.