Further detail has emerged following the Chancellor’s announcement last Friday evening which confirmed the headline details of the revised Coronavirus Job Retention Scheme (CJRS). The Scheme has seen an estimated 8.4 million of the UK’s employees ‘furloughed’ – at a cost to the Government so far of circa £15 billion.
Whilst the next full version of the official Guidance to the Scheme will not be published until 12 June, what we now know is that:
- There are no changes to the CJRS for June and July.
- From August employers will need to pay the NI and pension contributions for their furloughed employees (in respect of the hours the employee does not work).
- For September employers will need to fund 10% of the furloughed employee’s grant (i.e. HMRC will pay a grant of 70% up to a cap of £2,187.50) and NI and pension contributions.
- For October employers will need to fund 20% of the furloughed employee’s grant (i.e. HMRC will pay a grant of 60% up to a cap of £1,875) and NI and pension contributions.
- The CJRS will end entirely on 31st October 2020 and will be closed to new entrants from 30 June 2020. From this point onwards, employers will only be able to furlough employees that they have furloughed for at least a full three-week period prior to 30 June 2020. This means that the final date by which an employer can furlough an employee for the first time will be the 10 June 2020, in order for the current three week period to be completed by 30 June 2020.
- From 1 July 2020, the number of employees an employer can claim for in any claim period cannot exceed the maximum number they have claimed for under any previous claim under the Scheme.
- From 1 July 2020, the concept of flexible furloughing will commence.
- Flexible furloughing means that employers will have the flexibility to decide on the right arrangements for them and their staff. They may, for example, bring back a furloughed full-time employee to work two days a week (and will pay the employee for those two days) but leave them furloughed for the other three days.
We will provide our clients with more detailed guidance taking into account the updated law and CJRS official Guidance when published on 12 June 2020.
If your business needs help with implementing the CJRS or you have any queries – or would benefit from strategic advice from our Employment Team who have been assisting many clients navigate their way through the CJRS options – please contact us via email or by calling 01603 610911.