COVID-19 Job Retention Scheme (CJRS) - Furloughed Employees

In order to assist employers with the burden of paying furloughed employees during the corona-virus outbreak, the UK Government has introduced a new job retention scheme (CJRS).

The PayRun.io API has been updated to include a new calculation option for Furloughed Employees. The new calculation option is intended to help employers determine the amount of furlough payment due to employees under the new scheme.

CJRS At a glance

  • Employers are entitled to re-claim 80% of an employees salary when the employee is fourloughed due the corona-virus pandemic.
  • The maximum amount that can be reclaimed (per employee) is £2,500.00 per calendar month.
  • The scheme operates between 1st April 2020 and 31st October 2020.

Pro-Rata Payments

The PayRun.io API furlough employee pay instruction includes an option to specify a pro-rata method. This allows the calculation of entitlement based on partial periods of pay and pay periods that do not directly align with calendar months. See the Pro-Rata page for more information on the available options.

The recommend pro-rata method is Days Per Calendar Month

Offset Payments

The Furlough Pay Instruction provides an optional property entitled "StatutoryOffset". Setting this property to equal true, will instruct the calculation process to produce an offset pay line in addition to the payment pay line. The offset amount negates the calculated furlough amount and turns the payment into a reporting only aspect. This is useful when an employee continues on a full salary but the employer needs to know the furloughed portion of the net pay in order to reclaim it from the government.

Additional Employer Reclaims

Employers are also allowed to reclaim their national insurance contributions and auto enrolment contributions.

Employers Additional Entitlements
Employers are also entitled to reclaim the following amounts made during this period as they relate to the employees furlough payments.

  • ER NIC (employers national insurance contributions)
  • ER AE (employers auto-enrolment contributions)

Example - Weekly Paid Employee Using Default Calculation

The following example demonstrates the pay amounts calculated by the API for a furloughed employee working a weekly schedule.

  • Employee: Mr Johny Furlough
  • Annual Salary: £ 30,333.34
  • Pay Frequency: Weekly
  • Pro-Rata Method: Days per calendar month
  • Rounding Method: Round penny up

April 2020

  • Calendar days in month: 30
  • Daily Rate: ROUNDUPPENNY((£30,333.34 / 12) / 30) = £84.26
Period Start Period End Furlough Payment Explanation
2020-04-01 2020-04-07 £589.82 7 days at £84.26
2020-04-08 2020-04-14 £589.82 7 days at £84.26
2020-04-15 2020-04-21 £589.82 7 days at £84.26
2020-04-22 2020-04-28 £589.82 7 days at £84.26
2020-04-29 2020-05-05 £140.72 2 days at £84.26 (£168.52) capped at £2,500.00 in month

May 2020

  • Calendar days in month: 31
  • Daily Rate: ROUNDUPPENNY((£30,333.34 / 12) / 31) = £81.55
Period Start Period End Furlough Payment Explanation
2020-04-29 2020-05-05 £407.75 5 days at £81.55
2020-05-06 2020-05-12 £570.85 7 days at £81.55
2020-05-13 2020-05-19 £570.85 7 days at £81.55
2020-05-20 2020-05-26 £570.85 7 days at £81.55
2020-05-27 2020-06-02 £379.70 5 days at £81.55 (£407.75) capped at £2,500.00 in month

Pay Instruction Needed to generate example

curl -X POST \
  'https://api.test.payrun.io/Employer/ER001/Employee/EE001' \
  -H 'Accept: application/xml' \
  -H 'Api-Version: default' \
  -H 'Authorization: {OAuthHeader}' \
  -H 'Cache-Control: no-cache' \
  -H 'Content-type: application/xml' \
  -d '<?xml version="1.0"?>
<FurloughPayInstruction xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance" xmlns:xsd="http://www.w3.org/2001/XMLSchema">
  <StartDate>2020-04-01</StartDate>
  <EndDate>2020-05-31</EndDate>
  <Description>Optional pay line description for pay slip</Description>
  <PayLineTag>Optional tag value for generated pay lines</PayLineTag>
  <AbsenceStart>2020-04-01</AbsenceStart>
  <AbsenceEnd>2020-05-31</AbsenceEnd>
  <StatutoryOffset>false</StatutoryOffset>
  <AnnualSalary>48000.00</AnnualSalary>
  <ProRataMethod>DaysPerCalendarMonth</ProRataMethod>
  <RoundingOption>PennyUp</RoundingOption>
</FurloughPayInstruction>'
curl -X POST \
  'https://api.test.payrun.io/Employer/ER001/Employee/EE001' \
  -H 'Accept: application/json' \
  -H 'Api-Version: default' \
  -H 'Authorization: {OAuthHeader}' \
  -H 'Cache-Control: no-cache' \
  -H 'Content-type: application/json' \
  -d '{
  "FurloughPayInstruction": {
    "StartDate": "2020-04-01",
    "EndDate": "2020-05-31",
    "Description": "Optional pay line description for pay slip",
    "PayLineTag": "Optional tag value for generated pay lines",
    "AbsenceStart": "2020-04-01",
    "AbsenceEnd": "2020-05-31",
    "StatutoryOffset": "false",
    "AnnualSalary": "48000.00",
    "ProRataMethod": "DaysPerCalendarMonth",
    "RoundingOption": "PennyUp"
  }
}'

New API Elements

Several new API entities have been included to model the furlough payments.

Furlough Pay Instruction

The Furlough Pay Instruction enables the specification of a period of furlough entitlement. The specified duration, annual salary and pro-rata option allow for the calculation of 80% of salary up to the maximum allowed within the calendar month.

Year to date Furlough Pay Instruction

The Furlough Year to Date Pay Instruction allows for the specification of opening balances and explicit (un-calculated) furlough payment amounts.

Pay Line Furlough

The Pay Line Furlough is generated after the pay instruction calculation and used a reporting element in the pay slip and reports.