Coronavirus Job Retention Scheme Update.

August 26, 2020
6 minute read

Updated: Aug 13, 2020

**These documents are updated regularly and therefore this information is correct as of the day of writing. ** - As many of you will be aware, the Government have announced some changes to the support available to Early Years settings during the Covid19 pandemic. Whilst this is frustrating and worrying, we believe that taking a pragmatic and measured approach is the best way forward.  So lets take a look at what we currently know and break that down into the practicalities of leading an early years setting.

Lets start with the F word – Furlough!

We are all familiar with this word now, many of us have used this option in our settings, to furlough some or all of our staff team. If you are still unsure, you may find our furlough guide useful.  The previous word on the streets was that settings would receive all of their funding entitlement and be able to claim 80% of furloughed staff wages through the CJRS (Coronavirus Job Retention Scheme). Amazing!........

However, updated guidance on 17th April changes the Government's stance on this and settings will have to carefully consider the way they manage this process.

The latest guidance states:

Educational settings that are in receipt of some public funding should only furlough employees, and therefore seek support through the Coronavirus Job Retention Scheme, if they meet the following conditions:

  1. the employee works in an area of business where services are temporarily not required and where their salary is not covered by public funding.
  2. the employee would otherwise be made redundant or laid off
  3. the employee is not involved in delivering provision that has already been funded
  4. (where appropriate) the employee is not required to deliver provision for a child of a critical worker and/or vulnerable child
  5. the grant from the Coronavirus Job Retention Scheme would not lead to financial reserves being created

There are some clear examples here of where settings meet the conditions. For example, condition number 1 lends itself to group settings where one setting has remained open and others closed. Staff in the closed settings will go onto furlough, perhaps an area manager may also not be required during this time and can be furloughed. If your setting only accesses three year funding, then staff in the 0-3 rooms may also be furloughed as their salary is not covered by public funding and the employee is not involved in delivering provision that has already been funded. Settings should only remain open to care for the children of critical workers and/or vulnerable children, and therefore, furloughing staff who are not required due to reduced numbers appears to be acceptable under condition number 4. However, settings need to consider the income they are also receiving from the EEE funding.

It is important to remember that since announcing the support for businesses, the Government have always made clear that ‘no organisation should profit from the exceptional financial support available and should therefore only access the support required…. organisations which continue to receive Government funding should not furlough staff whose salaries that funding could typically be considered to fund, and therefore will not need to access the Coronavirus Job Retention Scheme (CJRS).’  As a setting leader, you will need to be clear about the income you have coming in, how that is spent, and whether claiming against the CJRS is acceptable.

Many settings have a combined income from 2 major sources; private fees and public funding and it is essential to understand these two income streams to be able to apply for furlough. You need to know what percentage of your total income is from private fees. Now don’t panic if maths isn’t your strong point, we have put together a spreadsheet that will help.

You can down load it here: Income calculator

Any white box with red figures needs your data inputting, the rest will work like magic and work you the percentage for you! The guidance states that you should use your February 2020 data for this, so pay attention to closures for half term, funding dates etc when completing the spreadsheet. The hourly funding rates for your LA will need checking too. There are other ways to work out your percentage of private fees, you don’t have to use our spreadsheet - we just like to make your life easier where we can!

Having this percentage means you know how much you can claim through the CJRS. Essentially, the proportion of income made up from private income is what can be claimed. So, for example, when you complete the % calculation, lets imagine you work out that 75% of your income is from private fees and 25% is from EEE funding. This means you can claim up to 75% of your salary bill for furloughed workers through the CJRS. Clearly, the settings who will feel the most impact from this are the settings with a high % of funding and low % of income from private fees.

We are awaiting further clarity on this as the sector challenges the decisions made and will keep you updated.

As a sector, we recognise that this change in support will have a huge impact on some settings, in particular settings with a high proportion of funded children, those settings already at breaking point before this pandemic struck. We want to be able to help in any way we can, and therefore, we are offering our support free of charge to 3 settings whose  % of private fees is 30% or lower. Please contact us if you feel this support would be beneficial to you.

Annual Leave

We have had questions around whether staff can take annual leave whilst on furlough. HMRC has provided come clarity on this, albeit it through the updating of the Employees' Guidance, but not the Employer's Guidance, at the moment. The update states that it is possible to take annual leave while on furlough, as predicted, with the employer having to 'top up' to 100% of normal pay. As a leader, it is important to think through the moral dilemma this provides. We know that annual leave is more than just a holiday. It is relaxation, time to unwind, time to travel, see family and friends, make memories and have a week or two of freedom to do whatever takes your fancy. We would question whether annual leave taken during furlough is truly annual leave.

Face the challenge head on!

We know that these are worrying times for the sector and for leaders, but these challenges must be faced head on. We have provided the Crisis Control Tool to help you to reflect on what you can and cannot control. You may feel like you don’t have the time for this right now, but take 15 mins to really focus on this, it will help! Being able to quantify what you can and can’t control, what help you can get and from where can be perfect for giving clarity and perspective. Check out our continuity planning mini toolkit for ideas on how to lead during these difficult times and help you reflect on your own behaviours.

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