Flexi furlough as a locum

Flexi furlough as a locum



Earlier on in the year, I wrote about the furlough scheme and the challenges that this may entail for us locum Optometrists or Locum Dispensing Opticians as owner managed businesses (Company Directors). The main thing was to ensure that you only carried your statutory director duties whilst on furlough, therefore not engaging in any activity that could be deemed to be revenue generating in nature (so booking locum days, locuming, etc).



On 29 May, the Chancellor announced changes to the Coronavirus Job Retention Scheme, with employers being allowed to part furlough their staff, ‘flexible furlough’. This means that now company directors who furloughed themselves need to consider their position from 1 July, the commencement period for flexible furlough.

How does this impact us as Locum Optometrist or Locum Dispensing Optician, especially given that locum work has also started to pick up following the go ahead from NHS England for routine eye examinations?

This is what we as Locum Accountants try to explain in this article, how directors of limited company should calculate their flexible furlough claim and what to be cautious of. HMRC has published some guidance on how this should be calculated for employees with either fixed or variable hours.

Unlike standard employees there are a few challenges in calculating a locum directors flexible furlough calculation, due to the uncertainty around ‘unusual hours’.  For us locums, its variable depending on how much we work, which ultimately depends on the rate and location on offer. Many locums whilst may have fixed locums days (which in its own might bring issues re IR35) but will most likely still have some variable element to their locum bookings.

Majority of the locums we know of, if not all, do not have:

- an employment contract in place, hence nothing stating our official ‘usual hours’ per week. 

- are not paid based on the hours worked but rather based on what is the most tax efficient way


So how can we decide our hours being a variable paid locum Optometrist or locum dispensing Optician?

In these cases, the best approach we believe would be to look back and find out the number days worked as evidence of your calculation for ‘usual hours’ usually worked. If you have been using the Locumkit app, then you can easily retrieve this information from a click of a button (for the past three years), as one of our many reports available to you reports to you on the number of days worked. In addition, you will need to keep some form of record of the days and hours worked for at least the flexible furlough period, which is where this report can be a great aid. Our financial module does not limit you to only bookings made via Locumkit but also all other bookings (direct or via other agencies).


Another thing to consider is your time spent on statutory duties (payroll, HMRC compliance work, etc) – should these now be considered as your working hours and not one for which you can claim furlough? Currently we do not have precise guidance on this but to be prudent we would advise that any time spent on such duties should be taken as your hours worked.

Below we have provided an illustration of how you can go about working your ‘usual hours’. When choosing your 'usual hours', always select the higher of your average hours worked in the last financial year vs. the actual hours worked in the same month in the previous year. Your claim would then be based on your hours worked as a proportion of your 'usual hours', multiplied by your monthly salary.


In the month of March 2019, Mo locumed 15 days, equating to 112.5 hours (assuming 7.5 hours per working day). In July 2020 Mo shall be locuming 4 days and therefore 30 hours (again assuming 7.5 hours per working day). Mo is on a low salary, high dividends scheme with his monthly salary set at £600 per month. Based on this Mo’s furlough claim for the month of July 2020 would be:

(112.5-30)/112.50 x £600 x 80% = £352

Note: The above calculation is for the month of July. This changes in the following months as the scheme wears off. For a recap on the changes please refer to our earlier article on CJRS phase 2 here.


The claimed amount has reduced (vs. £480) but it has enabled Mo to come off furlough and locum for a few days. Some of us locums have taken up on other jobs as well such as the NHS Clinical Contact Caseworker, which does not have a bearing on your furlough claim. Your furlough claim is only impacted by your primary source of trade, hence locuming for us Optometrist and Dispensing Opticians.


We at Locumkit accounting have requested for additional guidance from HMRC on how directors should proceed under the flexible scheme. We shall update you as soon as we have more information. In the interim please ensure you have workings to support your calculation for ‘usual hours’ and evidence for the hours worked.

We have been informed by HMRC that they are aware of the fact that the directors flexible furlough scheme is very much open to abuse and therefore to act as a deterrent the government has given HMRC the powers to investigate your claims for the next five years. We advise you carry out the above calculation correctly and maybe consult a specialist before submission. HMRC have an online calculator, which can help you with this.


If you have any questions in regards to the any of the governments reliefs or any other accounting related queries then feel free to drop me an email and I or someone from the Locumkit team shall get back to you - [email protected]

Last week the Chancellor provided an update on phase 2 of his COVID19 relief, which also had potential some good news for locums who have furloughed themselves. A job retention bonus of £1,000. To read more on this please click here.


What is Locumkit?

Locumkit - Bespoke locum management platform for locum Optometrists and Dispensing Opticians (Locum Agency & Accountants); we help you get locum days, maintain your income/expenses, send invoices (all on the cloud), file your accounts - all from one place. Why not register and see what we are all about, especially as locum work starts to pick up we shall aim to regain contact with employers to get you work.

Specialist Accountants for locums - to find out more click here

To find out more about what Locumkit can do for you locums Optometrists and Dispensing Opticians, click here