Furlough: do old scheme claims still matter?

Your employer’s furlough claim and your missing wages are two different disputes. HMRC can recover an overpaid grant without putting a penny in your pocket. If you were underpaid in 2021, a contract claim may still recover the money. Start with the missed payday, not the date the scheme closed.

What the closed scheme covered

The Coronavirus Job Retention Scheme covered furlough from 1 March 2020 to 30 September 2021. Around £70 billion was claimed across 11.7 million jobs, according to the final evaluation. The headline wage support was 80%, capped at £2,500 a month for full furlough. Flexible furlough began on 1 July 2020. Employers paid normal wages for hours worked and claimed only for furloughed hours. The government’s contribution fell in July and August 2021, but employers still had to fund the required 80%, subject to the cap.

You cannot make a new CJRS claim. HMRC’s guidance confirms the closure. The grant went to your employer; your right to wages came from your contract, any agreed furlough variation and statutory protections.

Can you still recover missing pay?

For underpayments ending in 2021, the ordinary tribunal deadline has usually expired. Historic unlawful-deduction claims normally had three months minus one day from the deduction or the last deduction in a series, with early conciliation affecting the calculation. Late-claim exceptions exist, but discovering a shortfall now does not automatically reopen the case. Claims already brought in time are different.

In Great Britain, the six-month tribunal reform is in force from 1 October 2026. Regulation 4 of SI 2026/954 keeps the old rules where the claim’s relevant date falls before then. It does not give an isolated 2021 underpayment a fresh deadline. Northern Ireland has separate employment legislation and tribunal procedures; do not apply the Great Britain reform there.

A genuine breach-of-contract claim normally has a six-year limit under England and Wales’s Limitation Act and Northern Ireland’s Limitation Order. Each missed payday has its own clock. Pay due in September 2021 would normally reach its limit in September 2027. Pay due in March 2020 normally reached it in March 2026. The last underpayment does not keep earlier ones alive. Do not use “September 2027” as a deadline for the whole claim.

How much you were owed

The scheme’s 80% payment condition did not itself rewrite your contract. Read what you agreed. A lawful furlough variation could reduce your wages, but an employer still owed any higher amount it promised.

There was no scheme requirement to top ordinary furlough pay up to 100%. In Sutton v First Manchester Ltd, wording about average pay mattered to the worker’s claim. Check your own letter rather than assuming 80% of basic salary was the right calculation.

Holiday, redundancy and notice need separate checks

Holiday taken during furlough had to be paid at the normal holiday rate. Seward v Harper JD Ltd involved a contractual shortfall. But Working Time Regulations regulation 16(4) says the statutory payment right does not itself confer a contractual right. Court recovery needs a separate contractual basis.

From 31 July 2020 in Great Britain, the furlough week’s-pay regulations protected calculations for statutory redundancy and specified other payments against furlough reductions. Northern Ireland introduced its own equivalent protection. The £2,500 furlough cap was not the redundancy-pay cap. Age, service and the statutory limit applicable at the time still mattered.

Under Employment Rights Act section 163, statutory redundancy disputes belong in the employment tribunal. The historic deadline was normally six months minus one day. You cannot rescue an expired statutory claim by calling it breach of contract. A separately promised contractual redundancy payment needs its own assessment.

Full notice pay was not guaranteed in every arrangement. In Great Britain, section 87(4) excludes the statutory protection where the employer’s contractual notice requirement is at least one week longer than the statutory minimum. Have your notice clause and furlough agreement checked.

What to do now

1. Find the agreement and paydays. Collect your contract, furlough letters, payslips, holiday records and redundancy calculation. Save rotas and messages if you worked. List when each payment was due.
2. Calculate each shortfall. Record gross pay promised, gross pay received and the difference. Separate wages, holiday, notice and redundancy.
3. Get the claim checked. Contact your union legal service, Citizens Advice or a law centre. Use Acas in Great Britain or the Labour Relations Agency in Northern Ireland. UNISON, GMB, Unite and Usdaw cover many care, NHS support, hospitality, warehouse and retail jobs. Ask whether help covers a dispute predating membership.
4. Write to the employer that owed you. For agency staff, identify whether this was the agency or umbrella company. Set out dates, the agreement and your calculation. Keep a copy and get advice on the letter before court action. A letter or grievance does not itself stop the deadline.
5. Separate recovery from reporting. Check whether a civil claim remains available and whether the employer can pay. Report suspected grant fraud and minimum wage underpayment through the separate routes below.

Ask about court fees, possible costs and fee help before filing. A judgment is not payment. If the employer has closed or entered insolvency, take advice before paying to sue. Mention any previous claim, settlement or acknowledgment of the debt.

Made to work while furloughed

A supermarket manager could not claim full furlough for you while making you stack shelves for that employer. Flexible furlough allowed work, but grants covered only the hours you did not work. Training and a director’s limited statutory duties were exceptions.

Check your normal wages and minimum wage entitlement for hours worked, taking account of pay already received. Save rotas, timesheets and messages. A dishonest grant claim is the employer’s conduct, not an excuse to withhold your pay.

Use HMRC’s fraud-reporting route for suspected furlough overclaims and the pay-and-work-rights complaint route for minimum wage underpayment. Give dates and explain that this happened during the closed scheme. Reporting guarantees neither an investigation nor recovery.

If you are an employer or director: HMRC can still come

Under Finance Act 2020 Schedule 16, the recipient owes income tax equal to the grant amount they were not entitled to and have not repaid. The charge normally arose on receipt or when entitlement to retain the grant ended.

The notification deadline was the later of 90 days after chargeability and 90 days after the Finance Act passed. Knowing non-entitlement at the relevant time and failing to notify is treated as deliberate and concealed. A wholly unrepaid £10,000 overclaim can mean £10,000 tax plus up to £10,000 penalty, with interest also possible. The maximum penalty is not automatic.

Normal assessment windows are four years, six for careless tax loss and 20 for deliberate loss or qualifying knowing failure to notify. Count from the relevant tax year end. For a charge in 2021 to 2022, the four-year window ended on 5 April 2026; the six-year window normally ends on 5 April 2028 and the 20-year window on 5 April 2042. An assessment already made does not disappear when its window closes.

Directors and other managers can face personal liability where a company is insolvent, or seriously likely to become so. Conditions include management responsibility and knowledge of non-entitlement when the tax became chargeable, and a serious possibility it will not be paid. HMRC must issue a joint liability notice. Insolvency alone is not enough.

Use HMRC’s pay-back guidance to repay. Keep payroll and claim records and take tax advice. Do not send the bill to former staff.

Who was covered, and who was left out

PAYE agency and zero-hours workers could be furloughed, subject to each phase’s eligibility rules. Variable-pay calculations depended on payroll history and claim dates. Ask for the original calculation; one 2019 to 2020 average did not apply to everyone.

Directors’ eligible PAYE salary counted, not dividends. The separate Self-Employment Income Support Scheme was for eligible genuinely self-employed people. It is also closed, with overclaims covered by Schedule 16. A gig-work label does not decide your employment status, and PAYE alone does not give you employee-only rights such as statutory redundancy pay.