On 29th May 2020, the Chancellor announced the changes to the Coronavirus Job Retention Scheme (CJRS) that will be implemented over the coming months and how the scheme will be phased out. The Government has issued a helpful fact sheet summarising the position:
10th June 2020. The scheme will close to new entrants on 30th June 2020. Employers will only be able to claim for furloughed employees that have been furloughed for a full three-week period prior to (but not necessarily immediately prior to) 30th June 2020. Therefore, the final date by which an employer can furlough an employee for the first time will be the 10th June 2020.
1st July 2020. From 1st July 2020 the scheme will only be available to employers that have previously used the scheme to furlough employees. From 1st July, claim periods will also no longer be able to overlap months and the maximum number of employees for which an employer can claim must not exceed a number previously claimed.
31st July 2020. Employers will have until 31st July 2020 to make any claims in respect of the period to 30th June 2020.
1st July 2020. From this date, employers can return to work furloughed employees on a part-time basis for any amount of time or shift pattern, while still being able to claim under the CJRS. An eligibility requirement of the scheme is that any flexible furloughing arrangement must be agreed between the employer and their employee and confirmed in writing.
The minimum period of flexible furloughing will be one week, and employers must pay their employees for the hours worked in accordance with their employment contract (i.e. in full) in addition to tax and NICs due on those amounts.
1st July 2020. From this date, the Government will pay 80% of wages up to a cap of £2,500 as well as employer National Insurance Contributions (ER NICS) and pension contributions for the hours the employee doesn’t work. Employers will have to pay employees in the normal way for the hours they work.
1st August 2020. From this date, the Government will pay 80% of wages up to a cap of £2,500 and employers will pay ER NICs and pension contributions for the hours the employee does not work.
1st September 2020. From this date, the Government will pay 70% of wages up to a cap of £2,187.50 for the hours the employee does not work. Employers will pay ER NICs and pension contributions and 10% of wages to make up 80% total up to a cap of £2,500.
1st October 2020. From this date, the Government will pay 60% of wages up to a cap of £1,875 for the hours the employee does not work. Employers will pay ER NICs and pension contributions and 20% of wages to make up 80% total up to a cap of £2,500.
Further details on the changes to the CJRS are awaited to be published on 12th June 2020.
Due to the unprecedented nature of the Coronavirus pandemic, the guidance on how to adapt to its impact evolves daily and becomes out of date very quickly. We recommend that employers keep checking to ensure you are following the most up to date guidance, particularly as there are still some unanswered questions about the CJRS.
Further, in addition to public guidance, there are always specific circumstances that individual employers must consider, such as a particular employee or employer arrangements or issues (contractual or otherwise). If in doubt, please take advice. You can reach us on 0161 941 4000 or via email at email@example.com