As you will no doubt have heard on the news, the Government has announced reforms to the Coronavirus Job Retention Scheme (CJRS). The key dates and changes are outlined below.
- 10 June is the last date for employers to place employees on furlough (to allow for the minimum 3 week furlough period).
- In June and July there will be no change in relation to the employer contribution to employees’ salary costs and the Government will continue paying 80% of furloughed employees’ wages.
- Flexible Furloughing will start on 1 July when employers will be able to work part-time and receive normal pay (funded by their employer) for any days worked, whilst continuing to receive furlough pay for any days not worked. It will be up to employers to decide how that will work in terms of the time split. Full guidance from the Government on Flexible Furloughing is due to be published on 12 June.
- From 1 August, employers will be required to pay National Insurance and auto enrolment pension contributions, and can no longer reclaim them through the CJRS. The Government will continue paying 80% of furloughed employees’ wages.
- From 1 September, the Government will only reimburse 70% of salary (up to a maximum of £2,187.50). Employers will also be required to top up the 10% of salary costs to 80% (or more depending on what the employer agreed with the employee).
- From 1 October, the Government will only reimburse 60% of salary (up to a maximum of £1,875). Employers will be required to top-up 20% of salary costs to 80% (or more).
- The Scheme will close on 31 October 2020.
- The Government has updated its guidance to reflect the changes set out above. Please read the updated guidance here.
- The Treasury Direction was updated on Friday, 22 May (please see here) but will be further updated to reflect the above reforms made to the CJRS. We will update you further once the changes are made.
This article does not constitute legal advice and specific advice should be sought in respect of particular cases.