The furlough scheme has been extended to the end of October, but staff will be able to return to work part-time from 1 July 2020.
The changes to the Coronavirus Job Retention Scheme (CJRS) were announced in the House of Commons by chancellor Rishi Sunak after concerns were raised about the impact removing the support too early would have on jobs. Employers will be able to put staff on part-time furlough, claiming the CJRS grant for a portion of their salary.
Critically, employers will only be able to claim going forward if they have previously claimed under the pre-1 July scheme. Also worth noting is that as there is a three-week minimum furlough requirement under the current rules, it follows that 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.
The proposed changes also introduce a new limit to the number of staff who can be included on a claim.
This will be based on the maximum staff ever included in any single pre-1 July claim. The Chancellor also confirmed that from 1 August the CJRS grant will no longer cover the cost of employers’ National Insurance nor pension contributions with employers expected to cover the costs.
What is changing?
For July, the grant will be available on the same basis as now (the lesser of 80% of pay and £2,500).
August - the CJRS will continue to pay 80% of wages
September - the CJRS will pay 70% of wages while employers will take on the other 10%
October - the CJRS will pay 60% of wages while employers will take on the other 20%
Throughout the duration of the furlough scheme, it is important to remember that the employee will continue to receive their salary entitlement in full, as set out by the terms of their employment contract.
The CJRS is a grant paid to the employer, and it is this grant which is now being scaled back, the calculation being based on the salary paid for any period while the employee is being furloughed.
Learn about the new furlough scheme
Pink is hosting an hour-long interactive webinar about the updates to the furlough scheme on Tuesday 16th June between 14:00 and 15:00 GMT. If you are unable to attend the live webinar, you can also register here in order to receive the slides and a copy of the session.
Furlough, flexible furlough & managing your payroll webinar
16 June 2020 at 14:00 GMT