The furlough scheme (due to close at the end of October) will now remain open until (at present) the end of March 2021
The final date for claims for the period up to 31 October is still 30 November 2020
Furloughed employees will continue to receive 80% of their current salary for hours not worked, up to a maximum of £2,500
Employers will be asked to pay only NI and pension contributions (i.e. around 5% of employee costs) at this time until the end of January – this puts the scheme back on a par with how it was in August (employers can top up salaries if they wish)
The government will review the scheme and the economic and Covid-19 situation in January to see whether they may ask employers for additional contributions under the scheme
You can part (flexible) or full-time furlough employees – any hours worked must be paid at the usual rate of pay
Employers will need to report and claim for a minimum period of 7 consecutive calendar days
Claims under the new scheme can be made from 11 November 2020 (including any arrears)
However, there will be no gap in support between the previously announced end date of CJRS and this extension
The Job Support Scheme, which was set to replace the CJRS on Sunday 1st November, has been postponed indefinitely, along with the Job Retention Bonus (as mentioned above)
Neither the employer nor the employee needs to have previously used the CJRS
Employees must be on an employer’s PAYE payroll (i.e. an RTI submission to HMRC) by 23:59 30th October 2020
Pay calculations should be based on the last normal pay period on or before 30th October for those on fixed wages or the average pay between whichever is the later of the start date of their employment or 6 April 2020 and the day before any furlough period began
Once again, you should get agreement to furlough in writing with employees as the scheme will continue to be audited by HMRC – please speak to Embrace HR to ensure you get the right documentation in place if you do need to furlough staff, whether part or full time
The government's furlough scheme pages continue to be intermittently updated - the new scheme largely follows the first scheme, with the key exception being the change of dates in who can be eligible (anyone that was already reported as on the payroll on 30th October).
There is one other, more unfortunate, change in that the Job Retention Bonus – set to be paid for employers who kept people on furlough until the end of January at a rate of £1,000 per employer has now been shelved indefinitely. We may see its return as HMRC have said that “An alternative retention incentive will be put in place at the appropriate time”, but as we know, nothing is guaranteed these days. We have already spoken to clients who are very frustrated by this as it had been built into budgeting plans.
Another thing to note is that people who were on the payroll on 23 September 2020 but were since made redundant may be re-employed and furloughed but we would express extreme caution if you are thinking of doing this – please contact Embrace HR if this is a consideration as you will need to consider the circumstances carefully and look at the employment law implications. Note that from 1st December, employers will no longer be able to reclaim the relevant proportion of notice pay via the furlough scheme.
You may find the following page a useful starting point if you’re looking at what else might be available for your business: