Training and wage top up payments, how will this effect employers?
The Education and Skills Funding Agency have confirmed that the national minimum wage requirement for a furloughed apprentice applies to only the “training hours during the furlough period”.
The ESFA also confirmed “A furloughed employee can take part in volunteer work or training, as long as it does not provide services to or generate revenue for, or on behalf of the employer. Training in this context includes apprenticeship off-the-job training. Where their provider can continue to deliver training remotely, a furloughed apprentice can therefore continue their apprenticeship whilst furloughed”.
“Where training is undertaken by furloughed employees, at the request of the employer, they are entitled to be paid at least their appropriate national minimum wage for this time. In most cases, the furlough payment of 80% of an employee’s regular wage, up to the value of £2,500, will provide sufficient monies to cover these training hours. However, where the overall time spent training, during the furlough period, attracts a minimum wage entitlement in excess of the furlough payment, employers will need to pay the additional wages. This is because time spent training is treated as working time for the purposes of the minimum wage calculations and therefore must be paid at the appropriate rate, taking into account the increase in minimum wage rates from 1 April 2020”.
According to the guidance by the ESFA “Employers should consider the hours that an employee is expected to train during the period of the furlough (which must be a threeweek minimum). Employers will need to ensure that the furlough payment provides sufficient monies to cover these training hours. Where the entire furlough payment equates to less than the appropriate minimum wage entitlement for the training hours during the furlough period, the employer will need to pay the additional wages to ensure at least the appropriate minimum wage is paid for the time spent training”.
For working examples provided by the ESFA that show how to calculate whether the furlough payment equates to less than the appropriate minimum wage entitlement for time spent training can be found on the associated document below (pdf).
Further guidance can be found on the Government's website at: https://bit.ly/AppFurGov
Any questions relating to furlough or any other apprenticeship queries you may have can also be emailed to firstname.lastname@example.org