The ins and outs of furloughing

by Johnny Minford, Principal at Minford Specialist Dental Accountants

This piece is a birdseye view of the situation for dentists just now, six weeks into the lockdown.

I have tried to comment on the overall picture based on the clients we deal with across the UK, what they are doing and the things they are finding.  Any comments are my opinion, and others may have different views.


Furloughing Practicalities


The mechanism of furloughing has caused much consternation in the profession for mixed practices. Whilst the issue is not yet resolved in detail, and my view is there will always be grey areas, we have as clear a steer from the CDO as we are ever likely to get.

The furloughing procedures should be on the basis of the Gross private/NHS split within the practice. A proportional part of the salaries should be apportioned. Individual members of staff should be allocated, even just on paper, to one side or the other. The furloughing can then be done with the non-NHS designated staff. The NHS allocated staff should receive their normal full pay.

The amount of salary or wages which goes into the furlough pay does not include bonuses, but is taken as the higher of the February 2020 or 2019 pay, and/or the average monthly 2019/20 pay if your hours vary. This should take into consideration most of the expected possible fluctuations in people’s remuneration. 

We are finding that the allocation of individual members of staff can be problematic. For some, it is obvious; for example, an employed hygienist will go on to the private side. So may potentially vulnerable staff, or those with vulnerable family members who may not be able to go onto the ‘front line’ if called upon. Otherwise, it falls to the principal to allocate individuals whose salary adds up to the proportion which must be allocated to the NHS, and who are not able to be furloughed. 

There is clearly a certain element of approximation this, as individuals cannot be divided in two. Reasonableness will prevail although many practices are making sure that just a little more is allocated to the NHS than the strict percentage figures would dictate.

Directors salaries if the practice is a limited company should also form part of the calculation. Directors may also be furloughed, but a working director who may be involved in the NHS deployment should not. Furloughing is for persons who are not at that stage income generating.

The normal salaries of staff who are currently on sick pay or those on maternity leave should be used in the proportional calculations. They are not available for NHS work, so should fall on the ‘private’ side. 

The practice is not entitled to the furloughing grant in addition to the Statutory Sick or Maternity Pay. It is agreed that a person can come ‘off’ sick and be furloughed instead, essentially choosing between furlough and SSP.

This is not the same with Maternity, but of course any employee has the right to choose to come back early from Maternity, at which stage they may be eligible for furloughing. There are long term consequences though and this is not a decision which should be taken lightly.  

One must also consider the need for telephone triage in the practice. Clinical staff retained to do this should have the requisite abilities to communicate on the telephone. Some are good at this, others less so. Such suitably capable staff clearly cannot be put on furlough. 

Another aspect of staff retention in the practice working environment rather than furlough is the practice’s need to continue to communicate with private and Plan patients. There will be inevitably a cancellation of some subscriptions; to keep this to a minimum practices should be contacting their patients and reassuring them that if they are in difficulty, their insurance is still able to help and support, either at a distance over the short period of time of the lockdown, or by referral to a suitable individual at a UDC hub.

Furloughing must last for a minimum of three weeks. It follows that individual staff may be rotated between the private side of the practice (and furloughed) and the NHS side (paid in full and available for frontline duty). The in/out mechanism, what I have called elsewhere the ‘Hokey Cokey’, will be for the principal to decide. It is felt in some quarters that staff are likely to be able to come back from furlough after a shorter period than three weeks if there is a clinical need. This would only apply to clinical staff, but may give a principal more options with their staff generally.

It is important that the principal writes down the thinking and the decision-making process.  
And it is always, always, worth remembering that this is a short-term situation, and practice teams will have to get back together again within a few short weeks. Team balancing and harmony now will have an affect down the track, one way, or the other.

Update: On 12th May the Chancellor announced that its Coronavirus Job Retention Scheme will continue until the end of October. Furloughed workers across the UK will continue to receive 80 per cent of their current salary, up to £2,500. New flexibility will be introduced from August (announced in July) to get employees back to work and boost the economy. This new flexibility may involve changes in how the Scheme operates in order to retain and maximise the benefits from it. Watch this space.