Update on the Coronavirus Job Retention Scheme
The Chancellor of the Exchequer has set out a number of changes to the Coronavirus Job Retention Scheme (CJRS), which will take effect over the next few months. The Chancellor confirmed that employers will be required to start contributing under the scheme.
A Fact sheet published by HM Treasury gives some more detail of how ‘flexible furloughing’ will be implemented. Some of the main points are:
- From 1 July employers will be able to bring back to work any employees who have previously been furloughed for any amount of time and any shift pattern. The employer will still be able to claim under the CJRS for such employees’ normal hours not worked but will have to pay in full for any hours worked.
- From August 2020 employers will be required to pay the employer national insurance contributions and employer pension contributions on the furlough pay.
- From September 2020 employers will be required to pay 10% of employees’ 80% furlough pay. Recoverable furlough pay will be capped at £2,187.50.
- From October 2020 employers will be required to pay 20% of employees’ 80% furlough pay. Recoverable furlough pay will be capped at £1,875.
- The scheme will close to new entrants from 30 June. From this point onwards, employers will only be able to furlough employees that they have furloughed for a full three-week period prior to 30 June.
- Further guidance on flexible furloughing and how employers should calculate claims will be published on 12 June.
Employers are reminded to ensure they have appropriate agreements in writing with staff for any furlough period and any change to that furlough period e.g. if they are returning part time.