Umbrella Company says no to furlough Umbrella Company says no to furlough
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  1. #1

    Nervous Newbie


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    Default Umbrella Company says no to furlough

    Well after 2+ years of doing 'the right thing' and working inside IR35, it looks as though I, and many others, have been shafted.

    Just got this from my Umbrella - not their fault at the end of the day but the Government that obviously despises contractors regardless of whether they are inside IR35 or outside.

    "As everyone will now be aware, the Government has put into place special measures to help workers during the current coronavirus (Covid-19) situation. The Coronavirus Job Retention Scheme (CJRS) allows eligible PAYE workers to be “furloughed” so that employers don’t have to lay off staff in these uncertain times.

    For any other employer, using the scheme would be the most sensible option as it would allow them to keep staff and not incur salary costs, as the Government will be taking on this cost themselves (paying 80% of the normal salary, up to £2500 per month).

    However, for umbrella employers, the situation isn’t so simple. Workers are only eligible to be paid National Minimum Wage under the scheme, and any “discretionary bonus” or “commission payment” is excluded. And, although the Government has decided to cover Employers’ National Insurance contributions, which makes up one part of our employment costs, they have not included the Apprenticeship Levy which is also a significant sum and which would be a cost to us if not wholly covered under the scheme.

    Further, whilst furloughed, it seems likely that our workers will continue to accrue entitlement to paid leave. Without having a fund to pay that out of (because the worker has undertaken no work, and therefore no amounts have been generated), this will be another cost to umbrella employers.

    Alongside our duties as an employer, the small margin that we make to continue operating as a business is also not covered under the scheme. This means that we won’t be generating any income to cover our overheads, even though resources will still be used to manage the scheme.

    For the above reasons, we have decided to not furlough any of our workers until we can be sure that taking part in the scheme won’t cause substantial and ongoing losses.

    If the Government introduces any changes which makes us re-evaluate our position, we will be sure to let you know."

    So that's that then - off to Universal Credit

    Steve

  2. #2

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    If you have no children you will get zero UC


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  3. #3

    Double Godlike!

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    Seriously, what were you expecting?
    His heart is in the right place - shame we can't say the same about his brain...

  4. #4

    My post count is Majestic

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    well I suppose its something that strengthens the response to IR35.
    "If you didn't do anything that wasn't good for you it would be a very dull life. What are you gonna do? Everything that is pleasant in life is dangerous."

    I want to see the hand of history on his collar.

  5. #5

    Nervous Newbie


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    Word for word reply recieved today also, so I guess the same UC...

    While I understand the UC is protecting itself, and it does no favours to anyone to see UCs going under, there appears little regard for those workers unduly affected with no recourse and no obvious means of support. I don't believe this is the intent of the CJRS.

    This decision leaves a dilemma however, since technically we are employed by the UC, so to claim UC or JSA we need either resign or be made redundant before any such claim can be made (I assume a claim could only be made after due notice periods is served). So do we hang on in the hope of a favourable outcome, sit it out as normal between contracts or resort to benefits (if any can be had) and perhaps lose out in the long run...?

  6. #6

    Some things in Moderation

    cojak's Avatar
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    That’s a real bummer.
    "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
    - Voltaire/Benjamin Franklin/Anne Frank...

  7. #7

    Fingers like lightning

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    can the moderators FIX the title of this section

    it should read NO coronavirus assistance

  8. #8

    Some things in Moderation

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    Quote Originally Posted by mrdonuts View Post
    can the moderators FIX the title of this section

    it should read NO coronavirus assistance
    We didn't mean government assistance, we meant any assistance fellow contractors can give.

    We knew that the government would be feck all use to contractors in this crisis.
    "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
    - Voltaire/Benjamin Franklin/Anne Frank...

  9. #9

    Fingers like lightning

    mrdonuts's Avatar
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    this is shocking there are hundreds of thousands working via umbrellas why isnt this being fixed

  10. #10

    Contractor Among Contractors


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    Cretins... don’t blame the UC, government have thrown so many to the wolves...

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