The Furlough Bonus Scheme

Date Added 09.07.20

With the current Coronavirus Job Retention Scheme (CJRS), or the “Furlough Scheme”, coming to an end on 31st October 2020 and not being extended, the Government have been looking at other ways for employers to retain employees in the wake of the Coronavirus pandemic. The Chancellor, Rishi Sunak, has now announced a “Furlough Bonus”, but what is it and what does it mean to you?

What is the Furlough Bonus Scheme?

The Government will pay £1,000 per employee, to each employer who retains a furloughed member of staff until the end of January 2021.

What employees qualify?

Any employee who was furloughed under the CJRS may qualify. At the moment we understand that to include those employees on flexi furlough, or who have already been brought back to work from furlough leave. This of course may change, as more details emerge.

In order for the Furlough Bonus to be payable, not only does the employee need to be eligible, but they also need to remain in continuous employment, in the same job, earning more than £520 per month (on average between November 2020 and January 2021) until the end of January 2021.

When will the payments be made?

At the moment, payments will start to be made from February 2021.

What does this mean to you?

It means that if you have furloughed your staff and you don’t make them redundant before the end of January 2021, you can claim a subsidy of £1,000 to go towards the payment of their wages. This is a one off payment.

What other help is available from the Government?
The Kickstart Scheme:

The Government have also announced a “Kickstart Scheme” to give work placement support to young people aged between 16 and 24. The Government will subsidise the salaries of young people, who are aged between 16 and 24, where those individuals are claiming Universal Credit and may be at risk of long-term unemployment.

The Government’s Kickstart Scheme is designed so that employers can offer work placements to young people and the Government will cover 100% of the National Minimum Wage for those young people for up to 25 hours per week, over a 6 month placement. Anything above that can be topped up by employers.

Apprentices:

The Government announced that it will give business £2,000 per company if they hire apprentices and £1,500 if they hire apprentices over the age of 25.

What next?

As always with these updates in this unprecedented time, we need to watch this space. We need more clarity as to how quickly these bonuses can be paid, as companies already facing cash flow issues will need to know what they can expect by way of help and when. We’ll let you have more information when we have it.

This news, whilst no doubt welcome, may not be enough to help some companies already contemplating redundancies. The lack of clarity at the moment also means that there needs to be more certainty as to how the scheme works or applies to businesses, to avoid the Government seeking to recover funds in the future where they feel there has been, an  albeit unintentional, misapplication of the scheme.

How Tollers can help.

With so many changes happening during the current situation, the Employment team at Tollers have been working with businesses to provide advice and guidance in regard to the employment issues they find themselves facing.  The team have also seen a rise in the requirement for two of their key ‘off the shelf’ products.  The useful Redundancy Manager toolkit, which assists businesses to navigate the redundancy process, for a fixed fee, has been in huge demand and the Tollers HR package which helps employers manage the HR side of their business, ensuring that they have access to assistance and relevant legal advice from our specialist employment team regarding the HR issues they find themselves facing  https://www.tollers.co.uk/employment-law-solicitors/tollers-hr/.

If you’re interested in finding out more about the Furlough Bonus scheme, what it means to your business or for further information on how the employment team can assist … talk to Tollers on 01604 248558. We’re here for you.

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