Coronavirus Job Retention Scheme Updated - What You Need to Know

On Friday, Chancellor Rishi Sunak announced plans on how the Coronavirus Job Retention Scheme will operate from 1st August.  We had been told previously that the employees could return to work part time and that employers would have to contribute towards salaries so employers were waiting to find out what those changes meant for them.

So, the key changes are – 

From 1st July (one month earlier than previously advised), employers can bring their employees back to work on a part time basis through the new Flexible Furlough Scheme.   Employers are able to decide the hours/shift patterns as suited to their business and they will pay the employees normal wages for time worked. 

Further detailed guidance on how the Flexible Furlough Scheme will work is due to be published on 12th June.  

For June and July, the Government will continue to pay 80% of wages up to a maximum £2,500 plus ER NIC and pension contributions (3%). There is no cost to the employer (other than normal wages if the employee is working from 1st July). 

For August 2020, the Government will pay 80% of wages up to a maximum £2,500 and employers will be required to pay ER NIC and pension contributions. 

For September, the Government will pay 70% of wages up to a maximum £2,187.50 and employers will be required to pay 10% of wages (to make up to 80% and up to a cap of £2,500), ER NIC and pension contributions. 

For October, the Government will pay 60% of wages up to a maximum £1,875 and employers will be required to pay 20% of wages (to make up to 80% and up to a cap of £2,500), ER NIC and pension contributions.

Claims from July onwards will be restricted to employers currently using the Scheme and previously furloughed employees.  On that basis, the Scheme will be closed to new entrants on 30th June, with the last three-week furloughs before that point commencing on 10th June. Only employees who have previously been furloughed can be furloughed beyond this point. 

As with the previous scheme, if you decide to 'top up' salary above the 80%/£2500 level, you can continue to do so through the Flexible Furlough Scheme. 

Key questions for employers to consider at this stage are: 

Are there any employees who you need to furlough in advance of 10th June in order to be eligible for flexible furlough?

How can you utilise the Flexible Furlough Scheme to maximise the opportunity for your business?

Can you afford to part fund the employer costs of those employees on furlough from August through to October? 

 Do you need to consider implementing changes ahead of the end of October and do you have a plan in place to manage those processes? 

Remember – contact us for support with furlough and the Coronavirus Job Retention Scheme. Our team at Danton have a full understanding of what is required and we’re on hand to support you and work through these challenges with you, whether that be guiding you through the process or helping to ease the load during this transition. Call us today on 01527 306 760 or email us at info@dantonhr.com.