Updated Job Retention Scheme guidance confirms exclusion of tronc from furlough pay

Updated Coronavirus Job Retention Scheme (CJRS) information online confirms that any tips, including those distributed through tronc, will be excluded from furlough pay.

Updated HMRC guidance says employers cannot include payments made at the discretion of the employer or a client when calculating wages. This includes any tips, including those distributed through tronc, discretionary bonuses and discretionary commission payments, as well as non-cash payments, non-monetary benefits, such as a company car, and salary sacrifice schemes, including pension contributions.

Speaking on Twitter, Jonathan Downey, co-founder of London Union, the group behind the Street Feast markets, said: “This is disastrous for people working in hospitality, many of whom earn half of their pay through tronc. This cannot be what the JRS intended to exclude and government has made a mistake here.”

The government announced the Coronavirus Job Retention Scheme last month, in which employers are eligible for grants to cover up to 80% of wages of employees not working but being kept on payrolls.

The Caterer reported two weeks ago that an HMRC spokesperson confirmed that this would not include tips, tronc or service charge. UKHospitality chief executive Kate Nicholls said the decision was "disappointing" and urged the government to reconsider; while nearly 23,000 people signed a petition calling on the government to include tronc in furlough wages.

The CJRS application portal opened on 20 April and more than 140,000 firms applied on the first day, with the government saying validated claims will receive funds within six working days.

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