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Furlough - performance related commission

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I have a client who pays employees salary plus a performance related commission, so this varies every month.  My understanding is that we can't reclaim 80% of this as in the salary.  HMRC say that only 'compulsory' commissions can be reclaimed - what's the difference in these commissions?

Thank you

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By paulhammett
17th Apr 2020 15:51

If it’s contractual, it can be reclaimed, otherwise not. In other words, does his contract of employment set out the basis of the commission calculation?

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By Wanderer
17th Apr 2020 16:08

Always look at the actual law:-

7.3 In calculating the employee’s reference salary for the purposes of paragraphs 7.2 and 7.7, no account is to be taken of anything which is not regular salary or wages.

7.4 In paragraph 7.3 “regular” in relation to salary or wages means so much of the amount of the salary or wages as-
(a) cannot vary according to any of the relevant matters described in paragraph 7.5
except where the variation in the amount arises as described in paragraph 7.4(d),
(b) is not conditional on any matter,
(c) is not a benefit of any other kind, and
(d) arises from a legally enforceable agreement, understanding, scheme, transaction or series of transactions.

7.5 The relevant matters are-
(a) the performance of or any part of any business of the employer or any business of a person connected with the employer,
(b) the contribution made by the employee to the performance of, or any part of any
(c) the performance by the employee of any duties of the employment, and
(d) any similar considerations or otherwise payable at the discretion of the employer or any other person (such as a gratuity).

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By kevinringer
18th Apr 2020 10:08

I want to make you aware that 3 documents were published on GOV.UK 17/04/20 evening which may help you.

1. New guide with worked examples at This addresses holiday pay including bank holidays.
2. New step-by-step guide at
3. The employers guide has been updated (this is version 5) at

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