Flexible Furlough – the payroll implications

Posted on 17th June 2020 by Streets

Image to represent Flexible Furlough – the payroll implications

As lockdown is eased many businesses will be looking at bringing back their furloughed workers.

As part of the measures to support employers who may want to manage returning workers in line with business demand and financial affordability, the government has introduced flexible furlough.

With effect from 1st July 2020, employers can bring back employees who have previously been furloughed, for any amount of time and any shift pattern, whilst still being able to claim under the Scheme for the normal hours not worked.

The provision of flexible furlough will no doubt be most welcome to those employers who have furloughed staff. 

Whilst entitlement to flexible furlough does not come in until the beginning of July, it is important that employers consider the potential payroll and HR implications of this provision. For many, the basis of calculating their furlough grant has been challenging to say the least. Flexible furlough creates a new set of challenges, with claims based on hours instead of days. Individual circumstances could potentially lead to further complexities when calculating a claim, thereby increasing the time it takes for the payroll team or provider to process the payroll.

This is aside from the implications of calculating claims in relation to those employees engaged on variable hours contracts or giving consideration to holiday pay implications.

Certainly, it is essential that a claim should not be made until you are sure of the exact number of hours worked during the claim period. If you claim in advance and your employee works more hours than the hours used as the basis for the furlough grant claim, then you will have to pay back any amount overclaimed to HMRC.

Whilst we have covered very briefly some of the issues around the introduction of flexible furlough, in our weekly update next week we will provide further in-depth information and guidance to help ensure employers can prepare for its introduction.

No Advice

The content produced and presented by Streets is for general guidance and informational purposes only. It should not be construed as legal, tax, investment, financial or other advice. Furthermore, it should not be considered a recommendation or an offer to sell, or a solicitation of any offer to buy any securities or other form of financial asset. The information provided by Streets is of a general nature and is not specific for any individual or entity. Appropriate and tailored advice or independent research should be obtained before making any such decisions. Streets does not accept any liability for any loss or damage which is incurred from you acting or not acting as a result of obtaining Streets' visual or audible content.


The content used by Streets has been obtained from or is based on sources that we believe to be accurate and reliable. Although reasonable care has been taken in gathering the necessary information, we cannot guarantee the accuracy or completeness of any information we publish and we accept no liability for any errors or omissions in material. You should always seek specific advice prior to making any investment, legal or tax decisions.

Expert insight and news straight
to your inbox

Related Articles

Welcome to our new merged practice Streets Andrew Wright in Wakefield!

We are delighted to announce the establishment of Streets Andrew Wright Chartered Accountants. The announcement follows the merger of the Wakefield practice, Andrew Wright & Co with ourselves.When asked about the merger, Sally Wright, Managing Director, said: “Fellow Director Richard Farndale and I are delighted and excited about the ...

Golf Day Secures Hole in One for Air Ambulance

We hosted our 11th annual charity golf day earlier this month raising a record amount of more than £7,500 for the Air Ambulance. The total amount fundraised will be divided between our three regional charities; East Anglian Air Ambulance, Lincolnshire and Nottinghamshire Air Ambulance and Yorkshire Air Ambulance.The winning ...

Ordering documents from Companies House

Companies House offers interested parties the ability to order certified copies of certificates and documents held on the Companies House register. You can order: a company certificate with certified facts; or a certified copy of a document held

You might also be interested in...