Coronavirus Job Retention Scheme update
Following the government’s announcement on 29th May that the Coronavirus Job Retention Scheme will start to wind down from this month, we have updated our guidance to reflect the changes that will be happening over the next few weeks, with more updates to follow after 12th June.
30th June 2020 – Scheme closes to new entrants
Employers will not be able to claim funding for any employees from this date, unless they have been furloughed for a full 3 weeks prior to this. This means employees must have begun their furlough leave on, or before 10th June 2020, in order for their employers to be eligible to receive the CJRS funding
Employers will have until 31st July 2020 to make any claims in respect of the period of 30th June 2020.
1st July 2020 – Flexible furloughing begins
Employers will be able to bring back to work, any employee who is on furlough, on a part time basis. Employees are paid normal pay by the employer for the days which they are at work and employers can claim the 80% funding for days not worked.
For example, an employee who usually works 5 days a week or 40 hours, comes back to work for 2 days a week or 16 hours. It is the employer’s responsibility to pay normal salary for 2 days/16 hours and the employer would be able to claim 3 days/24 hours and pay 80% for the hours not worked.
It is up to the employers to decide what hours and shift patterns will best benefit the business.
August 2020 – The level of the grant starts to slowly taper
The level of the grant will start to reduce from August in a plan to phase the scheme out completely and reflect that people are returning to work.
Employers will continue to receive 80% of employee’s salary through the CJRS, up to a cap of £2,500, but will now be responsible for paying ER NIC’s and Pension Contributions.
September 2020 – The grant reduces by 10%
The government will pay 70% of wages, up to a cap of £2,187.50. Employers will be responsible for paying ER NIC’s and Pension contributions as well as topping up employee’s salaries by at least 10%. This is to ensure that employees still receive at least 80% of their normal salaries while on furlough.
October 2020 – The final phase
The government will pay 60% of wages, up to a cap of £1,875. Employers will be responsible for paying ER NIC’s and Pension contributions as well as topping up employee’s salaries by at least 20%. This is to ensure that employees still receive 80% of their normal salaries while on furlough.
It is our understanding that the scheme will close on 31st October but we will of course update you as soon as more information becomes available.
As always, if you need our help with this or any other HR advice then do call us on 01536 215240.