News & Updates

Covid-19 Update: Third HMRC Treasury Direction (30 June 2020)

Martin Stephen

Published byMartin Stephen

30th June 2020

Covid-19 Further Update:  Third (and Possibly Final) Hmrc Treasury Direction (30 June 2020)

On 25 June the Chancellor issued the Third Treasury Direction in relation to the Coronavirus Job Retention Scheme (CJRS) which now sets out the law and will govern the flexible furlough arrangements from 1 July 2020.

The Direction in full can be found here

Here is a Summary of the main points:-

• Employers will have until 31 July to make any claims under the CJRS in respect of the period 1 March to 30 June. If, for example, you have employees who have been furloughed for three consecutive weeks from 22 June, you will have to make separate claims to cover the days in June and the days in July which you want to claim for, even though the employees have been furloughed continuously. This may mean that your claim periods will differ from the pay periods you use. This is to reflect the stepping down of the CJRS contribution each month over the next four months. July to October are defined as “CJRS Calendar Months”, which are really just like normal calendar months;

• From 1 July, a CJRS claim may be made in respect of a “flexibly-furloughed employee”, for which the latest Treasury Directive contains a new and longwinded definition, but which is essentially someone who was working less than their usual hours. To be eligible to make a claim under the flexible furlough arrangements, an employer must:

 Have already made a claim under the CJRS in respect of the relevant employee for the period ending on or before 30 June (with the exception of employees who are returning from family leave and Armed Forces Reservist Employees);

 Have instructed employees to do no work during the relevant claim period or not to work for the full amount of their hours, and they must have complied with this instruction;

 Have given the instruction by reason of circumstances arising as a result of Coronavirus or measures taken to prevent or limit its further transmission;

 Have an agreement in place with the employee either in writing or confirmed in writing. Please note however that the Third Direction says that the agreement must be made before the beginning of the period to which the claim relates (although it may be subsequently varied to reflect any change in terms and conditions). So if you want an employee to be flexibly furloughed from 1 July, ensure you agree with them in writing (or confirm the agreement in writing) before the new arrangements come into play; and

 In terms of Paragraph 13 of the Third Direction that agreement must contain “the main terms and conditions on which the employee will not work for the full amount of the employee’s usual hours in relation to their employment”. Evidence of that written confirmation must be kept until at least 30 June 2025.

• From 1 July, claims cannot straddle calendar months and the minimum claim period must be seven or more consecutive days, except in limited circumstances, for example where you are claiming for the first few or last few days in a month and you have already claimed for the period immediately before it. For no obvious good reason, this requirement to have claimed in respect of an immediately prior period does NOT apply where the claim period is a week or more. This does not mean you have to furlough staff for a minimum period of one week. From 1 July agreed flexible furlough arrangements can last any amount of time, save that unless otherwise specified, the period that employers can claim for must be at least seven calendar days. Furthermore, employers will not be able to claim for more employees than the maximum number whom they claimed for under any previous claim, except where they have employees returning from family leave or Armed Forces Reservist Employees;

• The provisions in relation to the calculation of “usual hours” are complex. It is not simply a question of taking the average over the preceding twelve-week period.

As always, you should take detailed advice in relation to your particular circumstances.

Please remember that we at WJM are here to help during this exceptionally difficult time, please don't hesitate to get in touch if there is anything you think we can help with.

For any advice in relation to any particular aspects of the above, please contact a member of the Wright, Johnston & Mackenzie Employment Team: Martin Stephen (, Liam Entwistle (, Andrew Wilson ( and John Grant (

The information contained in this newsletter is for general guidance only and represents our understanding of relevant law and practice as at June 2020. Wright, Johnston & Mackenzie LLP cannot be held responsible for any action taken or not taken in reliance upon the contents. Specific advice should be taken on any individual matter. Transmissions to or from our email system and calls to or from our offices may be monitored and/or recorded for regulatory purposes. Authorised and regulated by the Financial Conduct Authority. Registered office: 302 St Vincent Street, Glasgow, G2 5RZ. A limited liability partnership registered in Scotland, number SO 300336.