When the guidance on the Job Retention Scheme was first published there was some concern over what employees who had variable pay or who had worked for fewer than 12-months would be entitled to. Some said that they would not be entitled to anything and would need to apply for universal credit however that is not the case.

For furloughed employees who are on the payroll on 28th February 2020, as a minimum, employers must offer the lower of 80% of their gross salary or £2,500 per month.

For employees whose pay varies from month to month, if the employee has been employed for 12-months prior to the claim, they will be entitled to the higher of either:

  • the same month’s earnings from the previous year or
  • the average monthly earnings from the 2019-20 tax year

If the employee has been employed for less than a year, the employer can claim, and by inference the employee is entitled to, an average of the monthly earnings since they started work.

Finally, if the employee only started in February 2020, they may use a pro-rata for their earnings so far to make a claim.

The full guidance on claiming for wage costs through the job retention scheme may be read here: https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme