Revised coronavirus job retention scheme announced

Changes to the Coronavirus Job Retention Scheme which were announced on 29 May will enable businesses to bring furloughed employees back part time from 1 July – a month earlier than previously announced.

With furloughed staff, firms will decide the hours and shift patterns to find the best approach – and will be responsible for paying staff wages while in work.

From August, the level of government grant provided through the job retention scheme will be tapered to reflect that people will be returning to work.

The Government will continue to pay 80 per cent of people’s salaries for June and July,.

In the coming months, businesses will be asked to contribute a small share. Individuals will continue to receive 80 per cent of their salary covering the time they are unable to work.

Timeline  

  • June and July – government pays 80% of wages up to a cap of £2,500 as well as employer National Insurance (ER NICS) and pension contributions. Employers are not required to pay anything.
  • August – government pays 80% of wages up to £2,500. Employers will pay ER NICs and pension contributions.
  • September – government pays 70% of wages up to £2,187.50. Employers will pay ER NICs and pension contributions and 10% of wages to make up 80%.
  • October – government pays 60% of wages up to £1,875. Employers will pay ER NICs and pension contributions and 20% of wages to make up the 80% total.

 

Claims from July onwards will be restricted to employers currently using the scheme and previously furloughed employees.

As there is a three-week minimum furlough requirement under the current rules any new period of furlough leave must have started by 10 June 2020 to be complete when the current scheme ends on 30 June and so ensure the employee remains eligible from 1 July.

Employers will be required to submit data on the usual hours an employee would be expected to work in a claim period and actual hours worked.

Further guidance on flexible furloughing and how employers should calculate claims is expected to be published by HMRC on 12th June.

Should you require assistance around the Coronavirus Job Retention Scheme and furlough, please contact Sarah Ashton sashton@garbutt-elliott.co.uk who will be happy to help.