With the Coronavirus Job Retention Scheme ending on October 31st, many employers could be left in the lurch. Here are the key changes you need to be aware of.
Furlough Latest Developments
- Since July 1st, any employees still on the scheme are treated as a “flexible furlough” arrangement. This enables employees to return to paid work part time, while claiming furlough for the remainder of the time. Holiday taken during a flexible furlough period is treated as furlough, even on days the employee was otherwise due to work.
- Flexible furlough requires employers to calculate the baseline number of “usual hours” compared with the actual hours worked.
- Since August 1st, employers are required to contribute employer national insurance and pension contributions.
- In September, they’ll also be required to contribute 10% of wages, while the government will contribute 70%.
- From October, employer contribution increases to 20% and the government will top up the remaining 60%.
- The scheme closes on October 31st. It is now too late to furlough employees for the first time, unless they are returning from family leave or service in the armed forces.
- Employers can continue to claim the grant for employees who are serving their notice period. Statutory redundancy and notice payments are to be paid at the employee’s normal full rate of pay, rather than reduced furlough pay.
- The government has announced a new job retention bonus of £1,000 for every worker who is brought back from furlough.