UK Job Retention Scheme and Gender Pay Gap Reporting Update

• Published date: 26 March 2020
• Author: Nicola Whiteley,Mandy Perry
• Law Firm: Orrick - Employment Law and Litigation

On 20 March 2020, in a bid to prevent mass job losses as a result of the coronavirus, the Chancellor, Rishi Sunak, announced the Coronavirus Job Retention Scheme. The government has agreed they will reimburse 80% of wages for all employees who are ‘furloughed’ but still on the payroll, up to a cap of £2,500 per month.

‘Furloughed’ is not a term that is used in UK employment law but in this context, it seems to be akin to being placed on unpaid leave.

Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis. We still await full details of the Scheme but for the moment, the government has provided the following information on how businesses may access the scheme.

Employers must:

• designate affected employees as ‘furloughed workers,’ and notify their employees of this change – changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation; and
• submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required)

HMRC will reimburse 80% of furloughed workers’ wage costs, up to a cap of £2,500 per month. HMRC are working urgently to set up a system for reimbursement. Existing...