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job retention scheme looking less hopeful


anju
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Have you all seen the latest guidance? Now looks like getting the Early Years Free Entitlement Funding probably means not being eligible for the JRS unless a lot of your income comes from private fees. Unless I've misunderstood. Which is possible!! I've only skim read it as it's Friday night.

 

"The early years section of the new guidance confirms that a private provider should only furlough employees, and therefore seek support through the Coronavirus Job Retention Scheme (CJRS), if they meet the following conditions: 

  • the employee works in an area of business where services are temporarily not required and where their salary is not covered by public funding; 
  • the employee would otherwise be made redundant or laid off; 
  • the employee is not involved in delivering provision that has already been funded (free entitlement funding); 
  • (where appropriate) the employee is not required to deliver provision for a child of a critical worker and/or vulnerable child; and 
  • the grant from the CJRS would not be duplicative to other public grants received and would not lead to financial reserves being created. 

If it is difficult to distinguish whether staff are funded through free entitlement or private income for the purposes of meeting the first three conditions as listed above, then an early years provider can access the CJRS to cover up to the proportion of its paybill which could be considered to have been paid for from that provider’s private income.

This would typically be income received from ‘parent-paid’ hours, and excludes all income from the government’s free entitlements (or ‘DSG income’) for all age groups. The guidance includes an illustration of how this would work in practice"

Here is the actual guidance https://www.gov.uk/government/publications/coronavirus-covid-19-financial-support-for-education-early-years-and-childrens-social-care/coronavirus-covid-19-financial-support-for-education-early-years-and-childrens-social-care?utm_source=Foundation+Years&utm_campaign=d97a9fa42e-EMAIL_CAMPAIGN_2019_03_21_05_01_COPY_01&utm_medium=email&utm_term=0_8f9a6de061-d97a9fa42e-321568377&mc_cid=d97a9fa42e&mc_eid=1c2323b3c8

scroll down for the sector specific guidance for Early Years.

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It’s disgraceful to land this on us on the weekend before the claim line opens, we can’t speak to our LA’s or our payroll companies and having already furloughed staff :-( 

For charity settings we already can’t claim the small business grant, are loosing the time of year we do most of our fundraising and now have to work this lot out, we rely on our higher funding income this term to carry the Autumn term 😡 

 

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1 minute ago, Dennie said:

Does this also now mean that if the majority or even all of staff wages are covered by funded fees staff cannot actually be furloughed at all and should be paid 100% of their normal wage?

I need to know this too - have already paid last week of Spring term 4 at furlough rate

Always knew really that it was all too good to be true 

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It means that if your setting receives 35% in fees and 65% in funding, then you can only furlough staff up to the amount you would be losing in fee income. If you were able to furlough all or the majority of your staff and receive the early years free entitlement, then you would receive more income than you normally would - which would be too good to be true.  So for the example, you would work out your monthly salary bill and calculate 35% of it.  If I have understood it correctly!

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Apart from the fact it is really late in the day to be ‘clarifying’ this (having previously strongly implied the opposite), it doesn’t seem to take into account costs other than staffing (rent for example) or the fact that many settings can’t claim a £10000 grant as they are not eligible. 

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We only have a fraction of paying fees for the summer term and virtually all children are either 2, 3 or 4 year old funding so it looks like we either have to pay full wage for people not working or make them redundant.  I'm just trying to update my committee now in time for end of month payroll.

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Yes I think the same as you Dennie. Like someone else said, normally the summer term funding (which is the highest term funding) helps to plug the deficit which is always there in the autumn term. But it won’t be available for this purpose this year. Pretty depressing. 

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I have a year to go until i retire - it utterly breaks my heart that this U turn  will mean the end of my setting and many others :-((( The thought that i may have worked my last day is something i cannot get my head around.

Edited by Gezabel
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56 minutes ago, NBBubbles said:

It means that if your setting receives 35% in fees and 65% in funding, then you can only furlough staff up to the amount you would be losing in fee income. If you were able to furlough all or the majority of your staff and receive the early years free entitlement, then you would receive more income than you normally would - which would be too good to be true.  So for the example, you would work out your monthly salary bill and calculate 35% of it.  If I have understood it correctly!

I think that’s sounds right, It would have been much simpler to just say all staff are furloughed for the first 3 weeks @ 80% and that equates to the loss of fees and then taken them out of furlough, this way we may get to claim back a minimal % of what we pay them but they still can’t do any work because they are ‘furloughed’, the other option is take them off furlough ASAP and reduce their hours, we really needed to know this before setting out our furlough ‘stall’ to staff.

I guess we need to deduct the pay of unfurloughed staff to see what is left from funding to know how much of other staff it would cover ...oh I hate Maths 😡

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If we receive our full funding for 2 and 3 year olds and them receive back the amount we have lost from  paying families via the furlough then we haven’t gained and haven’t lost? ( if we only pay 80% pay to staff on furlough) 

if someone is able to work out an example that would be great: 

If a setting receives £15000 funding a month and £5000 from paying customers then does this mean we can claim up to £5000 for furloughing staff or only 80% of furloughing staff ( £4000) if this is the case then the nursery would be at a lose of £1000 per month?  

So we would need to un- furlough some staff but have no work for them to do!

🤔 

 

 

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My understanding is you can only claim 80% of the shortfall (so 4K not 5k in your example) but you don’t have to make up the other 20% wages, though we’ve already told our staff in their already sent out furlough letters, I’m thinking I might just claim the 80% of this months and then bring them off of it (that roughly equates to our fee loss) 

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1 hour ago, Dennie said:

We only have a fraction of paying fees for the summer term and virtually all children are either 2, 3 or 4 year old funding so it looks like we either have to pay full wage for people not working or make them redundant.  I'm just trying to update my committee now in time for end of month payroll.

If you receive mainly funding for the summer term and only a fraction of your income for the term is fee income, then you will be in a favourable position.  You will still receive all the early years funding income you would normally and you can furlough your staff up to the amount of fee income you would have received.  So you will not lose out.

It seems fair to me that if settings still receive their early years funding, they can't also be reimbursed for their staff wages too (by furloughing all of them) but they should only receive what they would have lost out on, by being closed and not receiving the fee income fees.  Otherwise there would be a lot of settings showing a surplus at their year-end.  So you can furlough the staff up to the amount of income that you would have lost.

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So I am a bit baffled here.  Our income for February from paying parents works out as £330 as of course we had half term in February.  So I can’t actually see that I can be bothered to try and go through the furlough process to claw back such a small amount. 

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51 minutes ago, zigzag said:

So I am a bit baffled here.  Our income for February from paying parents works out as £330 as of course we had half term in February.  So I can’t actually see that I can be bothered to try and go through the furlough process to claw back such a small amount. 

 

45 minutes ago, Harvey10 said:

Our fees are paid half termly so each month will be different.  Also the funding doesn't get paid monthly so looking ahead to March we had no funding in that month so presumably it will vary each month??

It's really confusing, apart from the issue of changing the guidance at very short notice. I've already furloughed my staff and now think I may need to unfurlough them? And the amounts to claim will be tiny like you say @zigzag  especially with the half term week in Feb. For term time only settings in particular, not being able to carry forward funding from the summer term to help plug the gap in the autumn term will be a real problem. I notice the government are 'developing' a portal or something so we can check how much we may be able to claim. I wonder when that will be available...

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14 hours ago, Gezabel said:

I have a year to go until i retire - it utterly breaks my heart that this U turn  will mean the end of my setting and many others :-((( The thought that i may have worked my last day is something i cannot get my head around.

Dear Gezabel - your post has been really bothering me - you will still be able to get some 'help' if you have some fee paying children - have you seen the latest from EYA this morning?

Sending you a big virtual hug x

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1 hour ago, zigzag said:

So I am a bit baffled here.  Our income for February from paying parents works out as £330 as of course we had half term in February.  So I can’t actually see that I can be bothered to try and go through the furlough process to claw back such a small amount. 

I am in a very similar position - just £356.00 in fees in February

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12 hours ago, NBBubbles said:

If you receive mainly funding for the summer term and only a fraction of your income for the term is fee income, then you will be in a favourable position.  You will still receive all the early years funding income you would normally and you can furlough your staff up to the amount of fee income you would have received.  So you will not lose out.

It seems fair to me that if settings still receive their early years funding, they can't also be reimbursed for their staff wages too (by furloughing all of them) but they should only receive what they would have lost out on, by being closed and not receiving the fee income fees.  Otherwise there would be a lot of settings showing a surplus at their year-end.  So you can furlough the staff up to the amount of income that you would have lost.

I agree with all that you have written - just more than a little hacked off that we were given such conflicting advice

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1 hour ago, anju said:

 

It's really confusing, apart from the issue of changing the guidance at very short notice. I've already furloughed my staff and now think I may need to unfurlough them? And the amounts to claim will be tiny like you say @zigzag  especially with the half term week in Feb. For term time only settings in particular, not being able to carry forward funding from the summer term to help plug the gap in the autumn term will be a real problem. I notice the government are 'developing' a portal or something so we can check how much we may be able to claim. I wonder when that will be available...

Agree with you - oh and a new portal deep joy!

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I can see the thinking, it's the mixed messages and short notice that's annoying.

We're a not for profit anyway,  even if we did end up with a slight profit it would have gone to a good cause anyway. For us it was more to ensure we would still have funds to open in September. Hopefully we will be ok, but this is the first year we've actually had a small(very) amount of reserves, but fingers crossed it will be enough. :) 

Luckily this September is the first time we've had higher than normal numbers starting- just hope they don't all change there minds, AND the worst of this is over by September and parents have the confidence to send their children in.

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From my reading of the guidance, I don’t think it will be as simple receiving 80% of the private fee income. It depends on the *proportion* of fee income to government funding; it wouldn’t be calculated on the actual private fee income. For example, if you received £1000 in private fees in February and £10000 in government funding the same month, you’d be eligible for 80% of 10% of your wage bill. Let’s say your wage bill was £5000 you’d be eligible for £400. But you’d be losing £1000 private fee income. So you’d be £600 worse off. 

If you received 80% of the private fee income however, you’d be eligible for £800 ie double. And you’d only be £200 worse off.

 

 

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I thought hoped it might be as simple as this is what we get from funding a week x 3 wks, this is what we get from fees x 3wks + add a 3wk  guesstimate for loss of fundraising (worked on first 25 wks of the year) to the % difference and we could cover a fair bit of Feb wages from our funding BUT quite a high % of wages is paid from fees as they are the 2 yr olds with more staff and it doesn’t cover any other costs, and whilst they are obviously lower now they weren’t in Feb 🤯  

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it’s a bit of a minefield isn’t it?! 
 

but I think the calculation of what you’d be eligible for @Mouseketeer is only based on the proportion of fee income to government funding income and then 80% of that proportion applied to your wage bill. 
 

Still, the new portal will illuminate us all no doubt...

 

 

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Sadly maths and me do not go together and trying to work figures out this morning was super frustrating.  In the end I contacted our chairperson (who is a maths whizz) and said “help” (hard for me as I hate admitting defeat and asking for help) I gave her our funding income for February and our paid income for fees, this is what she’s come back with, but don’t ask me how!

Ok so that works out at 34% of our income. 
If we transfer that to wages we can claim 34% of our £1533.68 monthly wage cost.
 
which is £521.45 a month.
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