- November 6, 2020
Coronavirus Job Retention Scheme Update
The (CJRS) Coronavirus Job Retention Scheme, which was originally ending on the 31st of October, has been extended as a new period of national lockdown has been announced in England, beginning on the 5th of November. Rishi Sunak has announced that the furlough scheme will be extended until the end of March and will be reviewed in January.
The extended scheme allows employees to be placed on full or flexible furlough, and employers can still claim a government grant to fund a portion of wage costs.
To recap, what is Furlough?
Furloughing an employee can be considered as an alternative to making them redundant, it involves changing an employee’s status so that they either work no hours (Full furlough) or they work fewer hours than normal (Flexible Furlough), and they are still retained on your books.
The CJRS permits both full and flexible furlough, the grant claimed by employers from the government is to cover a portion of wage costs for the hours not worked by the employee.
Who is eligible?
To be considered eligible, employees must be on an employer’s PAYE payroll by 23:59, October 30th 2020. Real Time Information (RTI) submission notifying payment for that employee must have been made to HMRC between 20th March 2020 and 30th October 2020.
What does the grant entail?
Chancellor Rishi Sunak has confirmed that the government will continue to pay 80% of furloughed staff’s wages for hours not worked, to a maximum of £2,500 per employee per month, with employers only required to make national insurance and pension contributions.
As with the original CJRS, employers are still able to choose to top up employee wages above the scheme grant at their own expense if they wish.
In summary:
For claim periods running to January 2021, employees will receive 80% of their usual salary for hours not worked, up to a maximum of £2,500 per month, hence the scheme is more generous than the scheme running in September and October. The refund amount may be reviewed for February and March.
Can employers bring back and then furlough workers recently made redundant?
Employees that were employed and on the payroll on 23 September 2020 who were made redundant or stopped working for their employer after that date can be re-employed and claimed for.
Should vulnerable people be furloughed if unable to work from home?
It has been advised that those who are vulnerable should be especially careful. Whilst this is not a return to the very restrictive shielding advice followed earlier this year, precautionary shielding measures should be taken. However, clinically extremely vulnerable, and highest risk will be issued with a letter advising them to Shield until 2nd Dec 2020 (subject to review). It is possible to furlough shielding employees if they are unable to work from home.
The Job Support Scheme
The job support scheme has now been postponed.
Disclaimer
The information in this document is true to the best of our knowledge. It is based on our understanding and interpretation of the relevant legislation (and guidance) and is made without guarantee on the part of the author. Green Kite Associates Ltd gives no warranties of whatever nature in respect of the completeness of any information, and/or opinions contained in this document.
Green Kite Associates Ltd cannot be held liable for the use of and reliance of the content of this document.
