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Will the coronavirus job retention scheme apply to umbrellas?

FCSA very much welcomes the additional guidance that the government has recently issued in relation to the job retention scheme.  Whilst we are hopeful that this will be applicable to umbrella employers there are a number of critical details that need to be clarified, such as:

  • Confirmation that umbrella employees will meet the criteria for workers on variable rates of pay, so that the average regular total earnings from umbrella work can be used to establish the rate payable and claimable under the job retention scheme.
  • Whether the apprenticeship levy will be reimbursed in addition to the 80% wages reclaim, in the same way that the government is reimbursing ErNICs.
  • We are also seeking clarity as to whether furloughed workers statuses be switched on and off according to whether or not there is an assignment for them to undertake. 

In addition, if the job retention scheme can be applicable to umbrella employers, there is clearly going to be a very significant cashflow impact due to the delay in being reimbursed by the government.  Given that umbrellas will receive no income for their furloughed workers this cashflow issue is going to cause severe financial distress.  We are working with the government on what measures can be established so that we can avoid 625k umbrella employees being unable to benefit from the scheme and losing their income.