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Client furloughed 2 ees but then taken on family!

Client has staff members on furlough but has now hired family as temp - surely no CJRS claim??

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Exactly as the title says - a client with 8 employees has had two employees on furlough since March, one of whom at least is likely to be made redundant at the end of July. 

They have now sent me payroll info for May and told me they have taken on a teen family member as temp 25hrs pw.  Ignoring the work permit that I doubt is in place etc surely you can't have someone on furlough and then hire a temp. 

Well maybe you can do that legally, but more to the point surely you can't have staff on furlough, hire a summer temp and then expect to make a CJRS claim for the furloughed people?

I haven't yet been back to the client but from what I know of the business, staff members furloughed and the teen involved, I would be shocked if one of the trained furloughed staff couldn't do whatever the untrained teen is there to do.

Has anyone else come across this??  I am off to go through the rules in detail but surely it can't be right.

Replies (13)

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By memyself-eye
26th May 2020 14:04

depends on what the furloughed worker did/does and what the teen is hired to do> A bigger question is if the teen takes over the furloughed worker's job when the latter is made redundant.

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Replying to memyself-eye:
Giraffe
By Luke
26th May 2020 14:20

The teen should be going back to education in September but may continue to help on fewer hours.

One furloughed employee is office based, one is a practical worker. The teen will either be doing basic office work or basic practical work of the same type as the employee. It is the practical worker who is likely to be made redundant.

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By sally1964
26th May 2020 14:21

I think this will come up for lots of discussions in the future should HMRC ever query claims. It is a job retention scheme, but maybe different skills etc -

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By Tim Vane
26th May 2020 14:50

It is neither your job nor your duty to police the scheme. Your duty is to the client. The rules are clear; the client is entitled to furlough his employees. He is also entitled to hire new employees. Questions around future redundancy and employee rights are not accounting matters and (in most cases) are not covered by an accountant's PII, so we should not advise.

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Replying to Tim Vane:
Giraffe
By Luke
26th May 2020 15:01

Thanks Tim. I had not thought about the PII aspect.

That said, it may not be my job to police the scheme but I do need to be comfortable that I am not facilitating an abuse of the system.

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By the_drookit_dug
26th May 2020 14:54

I think that this situation sounds abusive and doesn't fit within the spirit of the scheme. Whether HMRC would be able to prove such and seek repayment is another matter.

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Replying to the_drookit_dug:
Giraffe
By Luke
26th May 2020 15:03

Thanks for your reply, it sums up my thoughts.

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Replying to the_drookit_dug:
RLI
By lionofludesch
26th May 2020 17:49

the_drookit_dug wrote:

I think that this situation sounds abusive and doesn't fit within the spirit of the scheme. Whether HMRC would be able to prove such and seek repayment is another matter.

Do they have to prove it ?

Surely they issue an assessment, the taxpayer can appeal against it but the burden of proof is on the appellant.

I dunno - decent computer analysis should flag up cases like this quite easily.

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By Matrix
26th May 2020 17:53

Luke, just use your instincts.

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Replying to Matrix:
Giraffe
By Luke
26th May 2020 17:54

Yes, I did and called them earlier. See below!

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Giraffe
By Luke
26th May 2020 17:54

Update - I phoned the client and had a general chat.

Now knowing about the work permit requirements and having thought about whether one of the furloughed members of staff could do the work required, they came to the conclusion that maybe it wasn't such a necessity to employ the teen family member after all...

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Replying to Luke:
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By I'msorryIhaven'taclue
26th May 2020 18:20

I had a similar climb-down from a client wanting to furlough his teenaged son, an existing p/t employee, and claim 80% of his wages. The risk to reward ratio was poor, not least because the client already sails close to the wind on other matters and he and his wife already qualified for the full £2.5k whack. Sometimes I think clients just need someone to make the decision for them, otherwise their greedy natures can get the better of them. Well done for sticking to your guns!

Luke, I wonder whether your interpretation would have been the same had your incoming part-timer been an unconnected employee? Seems to me that in that scenario there would be no obvious benefit to an employer in having a furloughed employee costing nothing and a replacement costing full whack versus an unfurloughed employee costing full whack (all other things being equal). Given which I guess it must have been the family connection that bothered you sufficiently to cause your protestation. Aren't people greedy!?

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Replying to I'msorryIhaven'taclue:
Giraffe
By Luke
26th May 2020 18:44

Yes, I think I may have had a different reaction had it been a totally unconnected party but it did smack of wanting the teenager to have some summer pocket money rather than being a business requirement. The business has operated throughout albeit on a slightly reduced basis.

I do have a couple of clients where the spouse is furloughed (and one where a family teen is furloughed) but those people have a complete halt to their business and the people involved are doing absolutely no work so I was fine with those ones.

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