As noted in our last update, published on 28 May 2020, specific information regarding the extension of the Coronavirus Job Retention Scheme (“CJRS”) was expected to be published by the end of May. The government has now updated the CJRS guidance to confirm that the CJRS will be changing from 1 July 2020 to a more flexible furlough scheme.
Further guidance on flexible furloughing and how employers should calculate claims will be published by the government on 12 June 2020.
Deadline for new entrants to the CJRS
The CJRS will close for any new entrants from 30 June 2020 and employers will only be able to claim for employees that they have furloughed for a full three-week period prior to 30 June 2020. This means that 10 June 2020 will be the last day that employers can place employees on furlough for the first time. Employers will have until 31 July 2020 to make any claims in respect of the period to 30 June 2020.
Flexible furlough arrangements
The updated guidance states that from 1 July 2020, employers can bring furloughed employees back to work for any amount of time and any hours or shift pattern, while still being able to claim the CJRS grant for their normal hours not worked. Employers will need to pay their employees in full for the days worked.
Full details have not yet been published in respect of this new flexible CJRS however, it appears that there will not be any limits or restrictions on the working arrangements of furloughed employees.
As staff currently on furlough are prohibited from carrying out any work for the employer during their furlough period, employers may need to amend current furlough agreements to permit employees to work during furlough and cover the circumstances in which the employer can require the employee to work.
Once the government has provided more information regarding the changes to the CJRS, it is hoped that the new rules will set out specific requirements to assist employers in being able to fully assess the most appropriate course of action.
Employer contributions to furlough pay
On 29 May 2020, the Chancellor announced that from 1 August 2020, the following changes will apply in respect of employers’ contributions towards furloughed employees:
- From 1 August 2020 – employers will have to pay employer NICs and statutory pension contributions.
- From 1 September 2020 – the government will only reimburse 70% of salary (up to a maximum of £2,187.50). Employers will be required to top up to 80% (or more, depending on what the employer agreed with the employee) and pay employer NICs and statutory pension contributions.
- From 1 October 2020 – the government will only reimburse 60% of salary (up to a maximum of £1,875) and employers will continue having to top up to 80% (or more, depending on what the employer agreed with the employee) and pay employer NICs and statutory pension contributions.
The government has confirmed that the CJRS will close on 31 October 2020.