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Coronavirus: the financial impact

This is a challenging time for dentists. Here we have collated advice on the financial impact of the COVID-19 outbreak and the mitigation measures being introduced. Each section covers the UK as a whole, then offers nation-specific information where it has been issued.

Page last updated: 29 March 2021

 

On this page you will find:

 

1. Useful links for GDPs

2. Business support measures promised by Government

3. Business interruption cover

4. NHS dental services provision

5. NHS provisions for sick pay

6. Associates in NHS practice

7. Associates in mixed practice

8. Salaried services (HDS, CDS etc)

9. Private practice

10. Associates in private practice

11. Private capitation schemes

12. Practice owners: advice on paying staff

 

NHS advice on COVID-19

 

NHS advice on self-isolating 

 

Government response in England, Scotland, Northern Ireland and Wales.

 

Stay at home guidance for households with possible coronavirus (COVID-19) infection 

 

Public Health England Guidance to health professionals 

 

Guidance on infection prevention and control for COVID-19 

 

Guidance and support for employers and businesses 


NI HSCB communications

 

2. Business support measures promised by Government

The following support measures are available from the Government:

 

  • The government’s Coronavirus Job Retention Scheme, also known as the Furlough scheme, will remain open until the end of September 2021. Under the scheme employees will continue to receive 80% of their current salary for hours not worked, up to a maximum of £2,500. Flexible furloughing will continue to be allowed, in addition to full-time furloughing. See our guide to this scheme in our section below on Practice owners: Advice on paying staff.

  • Business interruption loans, with the Government paying the first 12 months' interest.

  • Bounce Back Loan Scheme (BBLS) enables smaller businesses to get access to 100% taxpayer-backed loans after concerns have been raised about slow and difficult access to the coronavirus rescue schemes. The scheme offers businesses loans up to £50,000 within days of applying. No capital or interest repayments are due for one year. The Government will pay the interest for the first 12 months.

  • £10,000 extra cash grants have been made to some of the smallest businesses, some dental practices with rate exemptions have already received this.

  • Local Authority Discretionary Grants are available for small business who are not eligible for the Small Business Grant Fund or other government initiatives.

  • The Government will refund up to two weeks’ SSP per eligible employee. Statutory Sick Pay (SSP) is also payable from the first day of sickness. You do not have to wait three days before starting to pay SSP. SSP is payable for those who are self-isolating in accordance with UK Government guidance.

  • Limited measures were also announced to support the self-employed, but a £50k cap was placed on these, limiting the amount of dentists in private practice that can avail of it. We will continue to campaign to help associate dentists, please see the relevant sections below. Dental hygienists and therapists are likely to qualify for help under the Government’s self-employment income support scheme.

 

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3. Business interruption cover

Business interruption insurance covers a business for loss of income during periods when they cannot carry out business as usual due to an unexpected event. It aims to replace certain losses sustained by the business during the period of the disruption.

 

We understand that insurance companies will not cover additional risks, which were not factored into the pricing of the policy. And we acknowledge that these are unprecedented circumstances. However, we are very concerned that many of our members will not be covered for closures due to COVID-19.

 

We have taken legal advice in respect to insurers not paying insurance claims made by dentists in regard to business interruption during the COVID-19 pandemic. We were also the first trade union or professional body to directly engage with the Financial Conduct Authority (FCA) following the failure of most polices to pay out for losses incurred during the pandemic. Members can watch a recording of our webinar with law firm Brown Rudnick LLP on the legal issues relating to business interruption policies and the pandemic.

 

In January 2021, the Supreme Court issued its final judgement in relation to the Financial Conduct Authority’s case on business interruption insurance. Widespread media coverage gave the impression that the decision was a significant outcome for large numbers of small businesses.

 

However, many sets of insurance policy wording were not covered by the scope of the Supreme Court ruling. This was particularly the case where wording was already deemed to be clear regarding exclusions of coverage relating to the Covid-19 pandemic. The impact of the decision will be felt more in relation to ambiguous policy wording, where insurers are now being told again to settle claims.

 

Our assessment, based on previous survey work, is that most dental policyholders are not directly impacted by the FCA decision because claims for cover were excluded.

 

Some QBE policies were overturned in favour of the insured by the ruling, however again based on assessment of the market, we do not believe that many dental practices have those QBE policies impacted by that part of the decision. There are some dental practices insured by QBE, but the Court had already ruled in favour of the insured practices in those cases.

 

There are some positive aspects to the decision for those claimants with an established case:

 

  • Insurers will now find it difficult to argue that they can reduce any loss that happened before lockdown, if that loss is because of a slow-down in activity relating to the Covid-19 pandemic
  • Insurers cannot take any Covid-related issue into account in negotiating a payment
  • Prevention from accessing premises now includes partial prevention from accessing premises. Some policies in the dental sector had wording that required there to be prevention of access.

In summary, most insured businesses (in dentistry and across the economy) did not have a legal route before the Supreme Court decision, and won’t have a claim afterwards. However, the position on damages is now likely to be simpler to calculate where businesses haven’t settled but where claims have been accepted.

 

We know that this is an important issue for many dentists and we will update you when we know more.

 

 

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4. NHS dental services provision

General Dental Practitioners

England

NHS England contracts: Quarter four targets (2020/21)

 

We negotiated for some months with NHS England regarding the support package for contract holders in England for this quarter. We refused to sign up to a deal which saw practices face steep financial penalties if they were unable to hit 45% of their pre-pandemic UDA targets.

 

NHS England should have given practices detailed guidance on this issue in good time. We provided:

 

NHS England contracts: Targets for 1 April 2021 to 30 September 2021

 

NHS England introduced targets of 60% for dental practices and 80% for orthodontic practices.

 

Furloughed workers scheme and NHS contractual payments

 

There have been two different state schemes to help dental practices with an NHS contract:

 

1. The Government furloughed workers scheme, which has been extended until the end of September 2021.

 

2. The NHS will, subject to certain conditions, continue to pay dental practices in England and Wales their NHS contract value.

 

Wales

 

From 1 July 2020, NHS practices in Wales will receive 90% of their contract value. This will then move up to 100%, potentially from September. In return for this 90% of contract value, practices will work within the scope of the de-escalation plans, at present in the amber phase, and work through the back-log of patients as best as possible on a prioritisation of needs basis.

 

Practices can be in heightened amber and only offering non-AGPs, or be in low amber and be offering AGPs as well, as long as they are set up and signed off by the relevant authority.

 

Key to this offer of 90% is the move away from the UDA system, and its replacement with the UDAS, (units of dental assessment). This is a move from payment based on activity, toward payment based on patient need and number. And filling out the Assessment of Clinical Oral Risks and Needs (ACORN) risk assessment form is an important part of that.

 

We have been in frequent contact with Chief Dental Officer (CDO) for Wales, Dr Colette Bridgeman, on your behalf throughout the pandemic. We can now confirm that there is no set AGP target for quarter four; numbers are expected to be in keeping with the size of the contract and the ACORN status of the patient base.

 

There is also no intention to alter or impact on separate Emergency Dental Service (EDS) contracts. Instead, the ask relates to the core Annual Contract Value (ACV). Patients previously seen on a practice’s EDS contract that are seen for a follow up Course Of Treatment (COT) and care, that do not usually do so, will be treated as a new patient to the practice's core contract.

 

Is sticking with the UDA model an option?

 

Yes. You can stay with the UDA model if you wish. In making any choice, we encourage you to consider social distancing, provision of AGPs and patients throughput. UDA numbers will also be ghosted in the background, so practices will be able to see a comparison.

 

However, there could be clawback if you stay with the UDA. Your UDA target would be 75% of the original. This target did not count for April, May and June. So when deciding whether to stay with the UDA model, you should factor in how much activity you can complete going forward, and whether it will allow you to meet your UDA target.

 

In February 2021, the CDO confirmed that 76% of FP17W included an ACORN assessment between April and December 2020. 85 practices in Wales have signed up to Attend Anywhere. This is an encouragingly high adoption rate.

 

Northern Ireland

 

The Department of Health has publicised details of upcoming changes to the GDS Financial Support Scheme (FSS) in Northern Ireland. This will see patient contributions and abatement funding continue until the end of the financial year with the most noteworthy change being the new link between a GDP’s monthly FSS payment and their monthly Item of Service (IoS) earnings. It’s been confirmed that:

 

  • Nothing will change for the majority of GDPs, who are currently earning 15% or more of their average 2019/20 monthly IoS earnings. They will continue to receive 100% of their FSS payment
  • GDPs earning less than 15% will see an abatement applied
  • Those earning between 10% and 15% will receive 90% of their FSS payment
  • Those earning less than 10% will receive 80% of their FSS payment
  • Meanwhile, GDPs earning less than 1% will receive no FSS payment at all, unless exceptional circumstances can be demonstrated
  • And from the February-March payment cycle, those earning between 1% and 5% will see their FSS payments cut by 50%.

We continue to regularly engage the Health Minister and the Department of Health on Financial Support Scheme issues. We're seeking clarity on long term financial support and assurances that abatement will not be applied on FSS payments as the cost of delivering dentistry increases and patient throughput remains low. We will update you when more information is available.

 

Scotland

 

The Scottish Government has issued a letter from the Chief Dental Officer and a memorandum to dentists with details about the return to dentistry. We have welcomed the additional funding outlined in the CDO's letter – an extra 30% to the General Dental Practice Allowance and a 30% increase to the GDPA cap. However, we argue that this support did not go far enough.

 

We advise you to review this summary of the sources of financial support currently available to dentists in Scotland during the crisis. We are continuing to press the Scottish Government for additional funding mitigation measures for mixed dental practices.

 

The Scottish Government issued a revised funding package for NHS dentists on 30 March. This will provide 80% of the average income from items of service and patient contributions. This is what we asked for – a more equitable funding solution. This should hopefully provide much-needed reassurance to many dentists.

 

The Scottish Government subsequently issued a memorandum setting out more details about the funding package. In addition, Practitioner Services has published a Q+A to answer some of the queries it has received from dentists.

 

Mixed dental practices that receive NHS support funding, can also apply for support from other government sources to cover the private element of their income. These latter claims should be proportionate to the amount of private dentistry delivered.

 

We have written to the Cabinet Secretary for Finance to seek additional funding for private dentists to help them remain viable, and copied the letter to all other MSPs and all MPs in Scotland. This complements the BDA's UK-wide approach to seek additional support from the Chancellor.

 

For information on paying staff during closure and the options open to NHS practices in Scotland, please see section 12 below.

 

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5. NHS provisions for sick pay

There are provisions for long-term sick pay in all four nations. In all four schemes, there is no pay for four weeks, then NHS dentists are paid an amount based on their normal pay for the next 22 weeks.

 

The pay is due if a dentist cannot work due to sickness. At this stage, we have asked the relevant authorities to see how they are going to interpret this provision.

 

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6. Associates in NHS practice

COVID-19 is a global issue. We ask all our members to behave responsibly. Associates should work with practice owners to agree cover for emergency work and other dental work that can be carried out. There will, of course, be members of the dental team who are particularly susceptible to the dangers of COVID-19. In these unprecedented circumstances, we ask all associates and practice owners to work together constructively. 

 

England

 

NHS England contracts: Quarter four targets (2020/21)

 

We negotiated for some months with NHS England regarding the support package for contract holders in England for this quarter. We refused to sign up to a deal which saw practices face steep financial penalties if they were unable to hit 45% of their pre-pandemic UDA targets.

 

NHS England should have given practices detailed guidance on this issue in good time. We provided:

 

Q4 (January to March 2021): what should practices pay associates?

 

From the start of 2021, with the introduction of the pro-rata UDA contract target, the expectation that associates should be paid at previous levels is likely to no longer apply. Practices will therefore need to devise a fair payment mechanism that takes into account the adjusted UDA target. We recommend members use the BDA model side agreements as a fair way to pay associates.

 

The arrangements are complicated and there is the potential that practices will receive different levels of payment depending on whether or not they achieve the 36% of activity threshold. In addition, practices may not receive payment for UDAs delivered above the 45% target.

 

Find out more about targets, rates of pay and abatement:

 

April to September 2021: what should practices pay associates?

 

For information about targets, rates of pay and abatement:

 

NHS England contracts: Targets for 1 April 2021 to 30 September 2021

 

NHS England introduced targets of 60% for dental practices and 80% for orthodontic practices.

 

Helping associates

We have been keen to help associates who have issues with the money they have been receiving from their practice owners.

 

Our advice lines are open to Extra and Expert members and we will try to help them discuss the situation with their practice owners.

 

Where we are not able to help the parties reach agreement, and if the local area teams or health board is informed that the practice was in breach of the conditions of the continued contract payment, action may be taken.

 

We do our best to help parties resolve any disputes in a fair and constrictive way. We also  continue to represent your interests in discussions with NHS England, and are continuing to push for legislative change to ensure that appropriate earnings are passed on to associates.

 

Northern Ireland

The Department of Health has publicised details of upcoming changes to the GDS Financial Support Scheme (FSS) in Northern Ireland. This will see patient contributions and abatement funding continue until the end of the financial year with the most noteworthy change being the new link between a GDP’s monthly FSS payment and their monthly Item of Service (IoS) earnings. It’s been confirmed that:

 

  • Nothing will change for the majority of GDPs, who are currently earning 15% or more of their average 2019/20 monthly IoS earnings. They will continue to receive 100% of their FSS payment
  • GDPs earning less than 15% will see an abatement applied
  • Those earning between 10% and 15% will receive 90% of their FSS payment
  • Those earning less than 10% will receive 80% of their FSS payment
  • Meanwhile, GDPs earning less than 1% will receive no FSS payment at all, unless exceptional circumstances can be demonstrated
  • And from the February-March payment cycle, those earning between 1% and 5% will see their FSS payments cut by 50%.

We continue to regularly engage the Health Minister and the Department of Health on Financial Support Scheme issues. We're seeking clarity on long term financial support and assurances that abatement will not be applied on FSS payments as the cost of delivering dentistry increases and patient throughput remains low. We will update you when more information is available.

 

Scotland
It has said that dentists will continue to receive 90% of their average monthly item of service income (net of patient charges for fee paying patients) and they will protect NHS commitment status.

 

Associates’ NHS income is usually paid to the practice. Our view is that practices should pay that money, minus license fee, to the associates in the normal way.

 

The Scottish Government recently issued a letter from the Chief Dental Officer and a memorandum to dentists with details about the return to dentistry. We have welcomed the additional funding outlined in the CDO's letter – an extra 30% to the General Dental Practice Allowance and a 30% increase to the GDPA cap. However, we argue that this support did not go far enough.

 

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7. Associates in mixed practice

England

Self-employed associates earnings less than £50,000 are eligible to claim under the SEISS. This allows individuals to claim a taxable grant worth 80% of average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £7,500 in total.

 

Given that associates in England are potentially in receipt of NHS earnings as well as separately being eligible for the SEISS, we have been in contact with HMRC so that we can give clear advice to associates. HMRC have clarified to us their view on the SEISS as follows:

 

  • The Government has set out a range of UK-wide measures which will support private income for dentists. If they meet the criteria, private dentists who are self-employed could be eligible for the Self-employment Income Support Scheme (SEISS) and those who are employees and receive a salary through a PAYE scheme could be eligible for the Coronavirus Job Retention Scheme.
  • The SEISS eligibility criteria does include that the dental practitioner has been adversely affected by COVID-19. If part of the dental practitioner’s income stream reduces, but another part remains the same, it is still legitimate for them to claim the SEISS. Dental practitioners will receive the full grant based on 100% of their trading profits, even if only 50% of their profits have fallen.

In summary, if associates fulfil the criteria for the SEISS scheme, continue to receive NHS payments, but have seen any drop in their overall income (for example due to a reduction in private earnings), they can make a claim for a SEISS grant.

 

If associates are eligible and want to claim the first grant under the SEISS, the claim must be made on or before 13 July 2020. The scheme is being extended and associates may be able to make a claim for a second and final grant in August 2020. 

 

For more information on NHS contracts and abatement please see the Associates in NHS practice section.

 

Northern Ireland

HMRC has indicated (see above), that if associates fulfil the criteria for the SEISS scheme, continue to receive FSS payments, but have seen a drop in their overall income (for example due to a reduction in private earnings), they can make a claim for a SEISS grant.

 

One of the eligibility criteria for the SEISS scheme is that it is only open to those earning less than £50,000 from self-employed roles. We continue to lobby for the removal of this unfair and arbitrary limit. However, those self-employed associates earnings less than £50,000 are eligible to claim under the SEISS.

 

Associates should note that they are required to make a declaration each month when applying for Financial Support Scheme (FSS) funding if they are in receipt of other government supports. Duplication of support for HSC activity is not permitted under the FSS, and GDPs wishing to claim for support from wider business support schemes must do so in relation to private activity only.

 

Scotland

PSD have advised associates: "We consider that you should not claim any aspect of NHS income which you would normally receive, from HMRC. We would advise you speak to your accountant and other professional advisers to determine your course of action.  Practitioners should be aware that we are required to share data with HMRC in order to validate taxation and payments. We anticipate that HMRC will reconcile any payments they make."

 

However, HMRC has indicated (see above), that if associates fulfil the criteria for the SEISS scheme, continue to receive NHS payments, but have seen any drop in their overall income (for example due to a reduction in private earnings), they can make a claim for a SEISS grant.

 

One of the eligibility criteria for the SEISS scheme is that it is only open to those earning less than £50,000 from self-employed roles. We continue to lobby for the removal of this unfair and arbitrary limit. However, those self-employed associates earnings less than £50,000 are eligible to claim under the SEISS.

 

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8. Salaried services

If you are a salaried dentist, working in Hospital Dental Services, Community Dental Services or prison dentistry, for example, your employment status should not be affected by this crisis. You will continue to receive your salary.

 

However, it should be noted that they may be deployed elsewhere within the health service. For more info on this please see our latest advice on redeployment (see questions 28-32). This may prove quite stressful and members should be aware that they have access to our 24-hour counselling service.

 

If you are a salaried dentist and have an issue, please reach out: 

  • Members employed on national terms and conditions within the salaried/community dental service, in dental schools, in the armed forces or a variety of other employed roles within the NHS, please contact: employmentrelations@bda.org
  • Members working under hospital terms and conditions can contact the BMA for employment relations support: 0300 123 1233 (please quote your BDA membership number).

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9. Private practice

This is an exceedingly challenging time for business in the UK. The COVID-19 outbreak is impacting the incomes of private practices and many are currently in desperate financial circumstances. We are lobbying Government and representing your interests during this difficult time.

 

Business support made available from the Government

Chancellor Rishi Sunak has pledged additional support for business, on top of measures set out in the budget. These include:

 

  • The Government’s Coronavirus Job Retention Scheme, also known as the Furlough scheme, will remain open until the end of September 2021. See our guide to this scheme in our section below on Practice owners: Advice on paying staff.

  • Government-backed loans of £330 billion have been made open to all businesses. We are worried that many dentists are having difficulty accessing these, and are instead being offered commercial loans at very high rates.

  • Business interruption loans, with the Government paying the first 12 months' interest.

  • £10,000 extra cash grants have been made to some of the smallest businesses, some dental practices with rate exemptions have already received this.

  • The Government will refund up to two weeks’ SSP per eligible employee

  • Limited measures were also announced to support the self-employed, but a cap was placed on these, limiting the amount of dentists in private practice that can avail of it.

This situation is untenable. We’ve pushed for a fair and equitable solution for mixed and private practices. Our CEO, Martin Woodrow has outlined why it's so important for us to fight for private practices during the COVID-19 pandemic and how our campaign for support is having an impact.

 

Members with mixed practices, we've put together a tool to help you calculate how much you are entitled to claim as part of the furlough scheme. Watch this demo video to help you use our furlough calculator.

 

This is a stressful time and members should be aware that they have access to our 24-hour counselling service. Dentists who are worried they cannot meet their current personal household expenditure can also apply to the BDA Benevolent Fund for financial assistance.

 

Business rate exemption should be given to dentists

Dental practices were not included in the new measures introduced in Budget 2020 to give business rate exemptions to retail businesses. We believe that in the context of the business disruption caused by the COVID-19 outbreak, it is essential that this exemption be widened to include dental practices. We've made representations to government to that effect and we will update you on any progress made.

 

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10. Associates in private practice

Self-employed dentists have faced huge uncertainty in the face of COVID-19. The measures announced by the Chancellor last year to support the self-employed during the COVID-19 outbreak did not support the majority of self-employed dentists.

 

We have been working hard on your behalf, lobbying government to provide sufficient financial support to the self-employed during this time of national crisis. The government’s response has however been characterised by inaction on the question of support for associates in private practice.

 

As Chancellor Rishi Sunak told the House of Commons:

  • Self-employed are eligible for the business interruption scheme
  • VAT has been deferred
  • The Universal Credit enhanced rate is available to all self-employed, which includes housing support
  • Self-assessment tax payments have been deferred until January 21
  • Self-employed associates earnings less than £50,000 are eligible to claim under the SEISS. This allows individuals to claim a taxable grant worth 80% of average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £7,500 in total. If you fulfil the criteria for the SEISS scheme, and saw a drop in your overall income, you can make a claim for a SEISS grant.

Both your safety and the financial viability of your practice are driving priorities for us.

 

This is a stressful time and members should be aware that they have access to our 24-hour counselling service. Associates in significant financial hardship may also speak to the BDA Benevolent Fund about their situation and the possibility of financial aid.

 

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11. Private capitation schemes

We believe that it is best if practices do continue to pay all (or most) of the capitation money to associates, but on condition that associates repay some of that money if they have not been able to provide routine and other treatment to patients because of the lockdown or reduced activity.

 

 

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12. Practice owners: advice on paying staff

This continues to be a challenging time for dentists and dental practices all over the country. Practice owners under financial pressure have the following options regarding staff payments:

 

  1. Until September 2021, use the furloughed workers scheme, by agreeing employees that they are furloughed workers, as part of government scheme to keep staff employed on 80% pay. Members with mixed practices, we've put together a tool to help you calculate how much you are entitled to claim as part of the furlough scheme. Watch this demo video to help you use our furlough calculator.
  2. Agree with workers that they work reduced hours for proportionately-reduced pay
  3. Lay off employees on guarantee pay
  4. Consider making staff redundant.

 

The furlough scheme 

The furloughed workers scheme has been extended until the end of September 2021. In the meantime, practices can bring furloughed employees back to work on a part-time basis. If your practice qualifies to claim under the scheme, you now have the flexibility to decide the hours and shift patterns of their employees – with the government continuing to pay 80% of salaries for the hours they do not work.

 

You may, with staff agreement, designate employees as furloughed workers. This includes employees who are currently self-isolating. People on maternity and paternity leave who return to work are also eligible for the government’s furlough scheme.

 

You can then submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal that HMRC will set out.

 

Employers will not have to top up the remaining 20% of the furloughed workers’ pay. A draft letter to give to employees in mixed practices is accessible for members . Note that template says you will pay 80% of their pay. You may choose to pay more if you wish. If you do, insert the appropriate percentage in the letter. If you have a purely private practice, see the furlough letter for private practices .

 

For the question of how furloughed workers will tie in with help from the NHS, please see Section 4. NHS Dental Services Provision.

 
The key points of the furloughed workers scheme are:

 

  • You can claim up to 80% of furloughed workers usual monthly wage costs
  • The maximum that can be claimed is
    o   £2,500 a month, plus
    o   Employer NI contributions and
    o   minimum automatic enrolment employer pension contributions
  • We welcome confirmation from both the Treasury and NHS England that mixed practices can make full use of the furlough scheme in proportion to their private activity
  • You can claim for any employees who were on your PAYE payroll, and who had received a payment that had been notified to HMRC by 19 March 2020,whether full-time, part-time, or employees on a flexible contract
  • You can claim for employees you made redundant after 19 March 2020, as long as you rehire them
  • Whilst being furloughed, employees cannot do any work for you
  • Employees must have been notified that they have been furloughed
  • Wages of furloughed workers are subject to usual income tax and other deductions
  • Employees who work reduced hours during this time are not eligible for this scheme. They will have to be paid in the normal way
  • Normal equality laws apply to who you furlough and who you don’t
  • Employees placed on unpaid leave after 28 February 2020 can be furloughed
  • Employees on sick leave or self-isolating should get SSP, but can be furloughed after
  • Employees must be furloughed for at least three weeks. You can therefore rotate who is furloughed as long as those who are furloughed are furloughed for at least three weeks.

Mixed practices and the furlough scheme

 

It makes sense if the proportion of time staff are furloughed is the same as the proportion of private income at the practice. So, if private income amounts to 33% of total income, then each member of staff can be furloughed for 33% of the time and paid in full under the NHS scheme for the remainder.

 

If we assume this lockdown is for three months, then that would be one month as furloughed and two months as NHS. If private income is 50% of practice income, each staff member could be furloughed for six weeks and paid in full under the NHS scheme for the remainder.

 

Mixed practices can use our furlough calculator  to figure out how much money you are entitled to claim from the Government if you were to furlough some of your staff for a given period of time. To make it easier we've also made a demo video on using the furlough calculator.

 

We have drafted a letter for members with mixed practices to give to staff to explain the situation and seek their agreement to be furloughed workers .

 

How to claim for furloughing workers

Claims are made through the Government portal. You will need to sign in to this using the Government Gateway system for your business.

 

Payments may take up to six working days to reach the claimant. You can make the claim yourself, or you can delegate this to an agent who usually runs your PAYE affairs (for example, a payroll consultant or accountant).

 

Before making a claim, you should gather the following information:

 

1. In respect of your business:

  • The number of employees being furloughed
  • The dates employees have been furloughed to and from
  • Details of employees – the name and National Insurance Number of each furloughed employee
  • Your employer PAYE scheme reference number
  • Your Corporation Tax Unique Taxpayer Reference, Self-Assessment Unique Taxpayer Reference or Company Registration Number as appropriate for your entity
  • Your UK bank account details
  • Your organisation’s registered name
  • Your organisation’s address.

2. For each furloughed employee you will need to make a claim. Each claim is made up of up to three parts:

  • A claim for the furlough pay being given over the period of the claim
  • A claim for the cost of the employer national insurance payment made on the furlough pay
  • If the furloughed worker is a member of your workplace pension scheme, a claim for the cost of the employer pension contribution. This must be paid on to the employee’s pension scheme.

To assist in calculating these amounts, HMRC has provided a Coronavirus Job Retention Scheme Calculator. The calculator will work out each of the above elements which form part of your claim for each furloughed employee.

 

To use the calculator you will need details of each employee’s normal pay level, their National Insurance category, and dates including when they went on furlough, when furloughing ceased (if applicable), pay period dates (i.e. when each pay period runs to, such as the first to last day of each month), and what date employees are actually paid on. 

 

In respect of the pay level, this will be straightforward for individuals who are on regular levels of pay. However, if an employee has variable levels of pay (for example, because bonuses are paid, or there is a regular change in working hours), then it is more difficult to calculate what level of furloughed pay applies. At the current time, the calculator does not support this particular calculation, but there is further guidance to support such manual calculations. Your payroll provider should be able to support you with this.

 

The calculator will set out the amount you can claim for each pay period. You should save the results of this before moving on to carry out another calculation.

 

Once you have this information you (or your agent) can input this into the Claims Portal. Once complete you should receive a claim reference number. It is important that you keep a record of this (such as a screen print).

 

You should tell your employees that a claim has been made using this system. Further claims can be made if furloughing continues beyond the claim period.

 

Staff of NHS practices in Scotland

We have sought clarification from the Scottish Government with regards to the NHS COVID-19 Financial Support Payment and paying non-furloughed employees, and have been advised that this funding does not place a condition on practice owners to maintain pre-COVID-19 levels of (non-furloughed) employees’ pay.

 

NHS financial support measures are intended to ensure the integrity of the NHS dental team and that once dentists are able to restart NHS dental services, practices will be in a position to do so. The Scottish Government has stated that it hopes “the rational response for a practice owner would be to ensure that happens through continuing to remunerate their employees but it is not a specific condition of the NHS funding. As independent contractors, this is a matter for the practice and employees of the practice”.

 

The NHS COVID-19 Financial Support Payment places the following conditions on dentists:

 

  • There must be no consequential loss of workforce, and
  • Contractors must immediately advise their local NHS Board if their associateship agreement or any other arrangement with a practice has been terminated or put into abeyance.

Practice owners have the following options:

 

  • Practice owners may continue to pay their non-furloughed employees as per the employee’s contract of employment/on the same basis pre-COVID-19, or
  • Practice owners can consult with their employees over reducing their pay. Employees will need to agree to this. National minimum wage rules will still apply. Agreements should be confirmed in writing, or
  • Practice owners may wish to consult with staff to reduce their employee’s contracted hours of work. This approach may have implications over employees being able to be redeployed to the wider NHS, which is a condition of receiving the Financial Support Payment. Consideration will need to be given to the future when a practice owner may wish to consult again with those employees about increasing their hours, or
  • Practice owners who have short time working and/or lay off clauses in their (signed) employee’s employment contracts may wish to consider either of these two options. However, as the NHS is paying dentists public money to help keep their practices running it would not seem reasonable to adopt such an approach as it would go against the spirit in which dentists are receiving the Financial Support Payment.

When seeking to make changes to 20 or more employee’s terms and conditions, including pay and contracted hours, there are further consultation requirements on employers and potentially financial penalties if these processes are not followed.

 

Employees do not need to agree to these changes. If they do not agree to the change a formal process will need to followed. In some cases, employers may have to give notice to an employee, to vary the employee’s employment contract, of up to 12 weeks.

 

Reduced hours

You may agree reduced hours working. You could suggest or ask your staff to suggest to you a temporary cut in hours and hence a proportional reduction in their pay. There is no obligation for them to agree, but if you are frank and explain the circumstances and the alternatives (lay-off or even possible closure of the business) then they might be agreeable. However, note that the same rules on staff being able to claim for redundancy (see above) apply if you reduce staff hours on short-time working to 50% or less of their normal hours.
 
Any agreement to reduced hours or short-time working should be put in writing – including the new hours, the rate of pay, the date the reduced hours start and the date for reviewing reduced hours or the date that they return to their normal hours – and signed by the employee.

 

Guarantee Pay

Employed staff will either be entitled to full pay or only to guarantee payments during any period where there is no work.

 

What are guarantee payments?


Guarantee payments are £29 per day (£30 per day from April, or less, if the employee would normally earn less than £29/30 in the day). Employees are entitled to a maximum of five days of guarantee payments in any three months. Practices do not have to pay anything to staff once they have had their five days of guarantee payments.

 

When are employees only entitled to guarantee payments?


Employed staff will be entitled to only guarantee payments if, either:

 

a) The practice has a contractual right to lay off staff without pay. There is a clause in the BDA model contract of employment entitling employers to lay off staff with only guarantee pay.

b) Or, in normal times, they are only paid for the work they do; so they do not get paid normally if there is no work.

 

In all other circumstances, where practices have no work for staff, they will have to pay staff in full if the practice closes or if they need fewer staff.

 

How long can practices keep staff on guarantee payments?


If staff are on guarantee payments for more than four consecutive weeks (or more than six weeks in any 13-week period), they can give the practice a notice to claim redundancy pay. The practice may, if it wishes, issue a counter notice to that. A tribunal would then decide whether there is a reasonable prospect of the employee returning, within four weeks of giving the original notice, to full employment for at least 13 weeks. The provisions are not very simple. Our advice team is happy to advise on individual situations.

 

Redundancy

The Government is keen to avoid redundancies if at all possible. That is why is has introduced pay for furloughed workers. However, practices may be able to make staff redundant. There is a procedure to follow. We provide advice on redundancy . Staff who are made redundant may be entitled to Statutory Redundancy Pay, which can be calculated here.

 

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