Further to the Government's announcement on 12th May extending the Coronavirus Job Retention Scheme (CJRS), the Chancellor Rishi Sunak has provided further details on the gradual withdrawal of the scheme from 1st August.
The current scheme will continue to run as it is until 31st July 2020 whereby the Government will pay 80% of wages for furloughed employees up to a maximum of £2,500 per month per employee, as well as National Insurance (ER NICS) and pension contributions. Up to this point, employers will not need to pay anything.
One of the points announced on 12th May has been changed and that is that employers will have the flexibility to return furloughed employees back to work on a part time basis from 1st July (as opposed to 1st August as originally announced). Firms will be reponsible for paying the wages of any employees coming back to work.
Further details on the withdrawal of the scheme are provided below:
- From 1st August - The government will pay 80% of wages up to a cap of £2,500. Employers will pay ER NICs and pension contributions.
- From 1st September - The government will pay 70% of wages up to a cap of £2,187.50. Employers will pay ER NICs and pension contributions and 10% of wages to make up 80% total up to a cap of £2,500.
- From 1st October - The government will pay 60% of wages up to a cap of £1,875. Employers will pay ER NICs and pension contributions and 20% of wages to make up 80% total up to a cap of £2,500. For the average claim, this represents 23% of the gross employment costs the employer would have incurred had the employee not been furloughed.
- The scheme will cease on 31st October 2020.
- 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.
- When claiming the CJRS grant for furloughed hours; employers will need to report and claim for a minimum period of a week, for grants to be calculated accurately across working patterns.
The scheme will close to new entrants on 30 June, with the last three-week furloughs before that point commencing on 10 June. To enable the introduction of part time furloughing, and support those already furloughed back to work, claims from July onwards will be restricted to employers currently using the scheme and previously furloughed employees.
The Coronavirus Job Retention Scheme has saved over eight million jobs, helping one million employers hold on to their staff.
As more and more employers look to return their staff back to work, it is worth liaising with your employees to understand any concerns they might have, as well as determining ideal working hours (for example if they are still looking after children at home). At Dêmos HR, we can support you in identifying your employees' feelings via a bespoke return-to-work survey, or you can speak to us about our other resources.
Please do not hesitate to contact us either by reply to this email or on my mobile 07974 695 365 if you need any advice or assistance on any of the above.