Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what plans the Government has to provide support to SMEs to help ensure they can honour the holiday entitlement accrued by furloughed workers.

Almost all workers are legally entitled to 5.6 weeks’ paid holiday per year. Workers who have been placed on furlough continue to accrue statutory holiday entitlements, and any additional holiday provided for under their employment contract. If a worker on furlough takes annual leave, an employer must calculate and pay the correct holiday pay in accordance with current legislation. Where this calculated rate is above the pay the worker receives while on furlough, the employer must pay the difference. However, as taking holiday does not break the furlough period, the employer can continue to claim the 80% CJRS grant to cover most of the cost of holiday pay. Further details and guidance can be found here: https://www.gov.uk/guidance/holiday-entitlement-and-pay-during-coronavirus-covid-19.

The CJRS is one of the most generous schemes in the world. We are supporting over 1 million firms and have paid out over £25 billion in grants. If an average CJRS claim lasted 8 months, the total cost of employer contributions would represent around 5% of the total gross employment costs an employer would have incurred had the employee not been furloughed. In addition, SMEs continue to have access to a comprehensive range of support measures. The Business Support website provides further information about how businesses can access the support that has been made available, who is eligible and how to apply - https://www.gov.uk/business-coronavirus-support-finder.