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Forum Home  →  Discussion  →  Housing costs  →  Thread

furloughed workers,  remunerative work and the additional earnings disregard.

Prisca
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benefits section (training & accuracy) Bristol city council

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Hi

Lots of our customers have been furloughed.
Lots of these customers wdo not get the 30hr elelment in tax credits, but do get the additional earnings disregard (and childcare costs disregard) because they work 16hr per week or more.

Ideally, i want to use reg 6(5) to say that being furloighed is akin to being on holiday from work, which will allow us to treat them as in remunerative work and allow the aed and CCC disregard.

our partners provider is less certain, citing caseload about being engages in remunerative work - saying someone sat at home waiting for a call isnt in remunerative work whereas someone sat at wok waiting for customers is in remunerative work.

Clearly i am keen not to reduce hours (as this will end HB entitlement for a lot of customers because their tax creidts are likely to still include CCC , which wont be disregarded inthe HB assessment ) - anyone got any other caselaw which would counterbalance the “sat at home waiting” doesnt count?

speaking to colleagues in different authorities, it seems pretty evenly split between those who are keeping the hours at pre-furloughed levels, and those who are reducing them and removing the AED/CCC.

any help /pointers/ greatfully received.  Cheers - prisca

Charles
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Accountant, Haffner Hoff Ltd, Manchester

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Can’t help you with your query, but can I ask you - are you keeping the childcare disregard for those not being furloughed? This is relevant for people continuing to pay childcare costs to keep their place, but not actually using the childcare.

Tax Credits I know are paying out, but I’ve had mixed reports regarding the childcare disregard for HB.

Prisca
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Hi Charles,
, for those not furloughed, they would have to report a change in circumstances to get us to look at the case.
if they are still paying childcare and haven’t had a change to their income, then its unlikely they have anything to report to us.

For furloughed workers who are reporting changes to earnings, we are asking the position re their CCC and if they are still paying them, then we can disregard them…. but only if we treat them as being in remunerative work, hence my original post.
Being in remunerative work is what triggers the additional earnings disregard and the disregard of childcare costs.

So if a furloughed worker is a lone parent, and still paying ccc, but we reduce the hours to 1 (rather than keep at 16) then the CCC disregard is lost - this is what is likely to end their Hb entitlement.

Charles
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Interesting, thanks.

Is there no issue with the fact that the childcare is not actually being used? I’m thinking about Reg 28(6) and (7) which refer to “care which is provided”.

Prisca
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just because something is provided doesn’t mean to say it has to be utilised!
many CC providers still charge fees when the customer is on holiday. (or even sometimes for 2 weeks when the childcare provider is on holiday) We would not end CCC in their assessment because they were on holiday and not using the childcare costs they are obliged to pay to keep the childcare place. 
We would look at
1)whether the customer was in remunerative work and
2) whether the were paying CCC.and
3) who was providing the Childcare
if the CC is provided by a registered provider, then its all good.
We dont need the childcare to match the hours/days worked -nor do we ask/check/ care whether the child attends every single session that has to be paid for.

Charles
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Thanks for that. It does clash with what I’ve been told by some LAs. Do you have any guidance etc saying this? Or do you know how widely accepted this is around the country?
For clarity, I accept what you wrote in your last paragraph, that childcare does not have to match hours worked, nor does the child have to attend every session, but if the childcare is literally not being provided as now???

Thinking about your original idea of a holiday, it does sound a bit of a stretch to me - can furlough really be considered “holiday”?

Prisca
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but a lot of childcare is still available, for the kids of keyworkers for example. One partner migh tbe furloughed while the other carries on work. The childcare care is still being provided, but not utilised.

This whole situation is a steep learning curve, so theres no regs/guidnce we can get off the shelf, blow the dust off and look up, because its not happened before.

we know HMRC have been instructed to keep hours the same for all their customers , whether furloughed or not, for at least 8 weeks.
What I want clarification on is whether that same “protection/breathing space” can be applied to Hb customers.

Seems the policy intention of furloughing workers was to keep them employed and keep as much as the staus quo as possible. HMRC have done this with tax credits.

I cannot comment on what other authorities are doing, or what is technically the correct approach. 
But if its still has to be paid for , and the place is still available, then the only reason its not being provided is because customers have been told to stay at home.
We are still treating QYP as in full time education, even though schools are closed and exams cancelled - I know several friends with kids in the middle of their A levels (due to take exams this year or next) who are now arent attending school and getting as many hours as possible in their (formerly) part time/weekend jobs. .
Schools say they are still enrolled, so they are still treated as in FT education, even if theres no Cben in payment for whatever reason.

So if a child has a childcare place, that is specifically for them, and has to be paid for, and will be provided as soon as restrictions are lifted, i think it would be wrong to remove the CCC in that scenario.

removing the AED/CCC disregard will end HB entitlement for lots of our customers, and will probably hit lone parents the worst.
Im looking for a way to say being furloughed is still treated as remunerative work.

Charles
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Accountant, Haffner Hoff Ltd, Manchester

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Thanks for that. Appreciate your help.

Prisca
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benefits section (training & accuracy) Bristol city council

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DWP replied!!!!

And yes, a period of furlough is akin to a period of holiday and therefore is treated as remunerative work!

Charles
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Excellent!

Any mention in their reply about what I was concerned about - that is, the non-utilisation of the childcare?