Furlough Scheme has been extended
As you will have read, the Coronavirus Job Retention Scheme (CJRS) or Furlough Scheme has been extended beyond 31st October 2020 and will now remain open until “December”. At the present time no end date has been given and we believe that the scheme will remain in force for as long as the new lockdown restrictions remain. At the moment that is until 2 December 2020. Here is what else we know:
- The Job Support Scheme (JSS) has been postponed and the Government have indicated that this will come back into effect when the extended CJRS ends;
- The contribution from the Government under the extended CJRS is back to what it was from the start and so they will pay up to 80 per cent of an employee’s normal salary, subject to a cap of £2,500. Employers will need to pay National Insurance Contributions and Pension Contributions, as they did in August. This is more generous than the CJRS for September and October, when the Government’s contributions reduced to 70% and 60% respectively;
- To benefit from the extended CJRS, neither the employer, nor the employee needs to have used the CJRS before. To be eligible, employees only need to have been on the employer’s PAYE payroll as of 30th October 2020 (before midnight) and been on a Real Time Information (RTI) submission made to the HMRC also on or before 30 October 2020;
- Unlike when the CJRS first came about in March 2020, the Government have not said that employees who have been made redundant can be reinstated and put on furlough. However, if the redundant employee was on the RTI on or before 30 October 2020 (before midnight) and the employer’s PAYE payroll as of 30th October 2020, it is possible that they could be rehired and furloughed. However, there is no obligation to rehire;
- Flexible furloughing will also continue.
What does this mean to you?
If you have already agreed with your staff to go onto the JSS, then you will need to speak to them and explain that it has been postponed. They could be furloughed instead, but as always, please don’t hesitate to contact us to talk through doing it properly. We have some wording you can use. Any communication with staff who have already agreed to the JSS, needs to be sent out urgently as this scheme no longer applies at the present time. As before, if you intend to place an employee on furlough, this will need to be communicated in writing.
It is unclear whether staff being placed on the extended CJRS for the first time will affect the Job Retention Bonus, but we’ll update you when the Government provides clarity.
If you have a question regarding the new changes, the continuation of the Furlough Scheme or would like to understand the implications for your business and/or employees…Talk to Tollers on 01604 258558. Our Employment and Commercial teams are on hand to assist you with all you need to know.