Job Retention Scheme extended

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The government recently announced an extension for the Job Retention Scheme (known as JRS or the furlough system) for employers to 31 October 2020.

From 1 July, employers can bring back to work employees that have previously been furloughed for any amount of time and any shift pattern, while still being able to claim the JRS grant for their normal hours not worked. When claiming the JRS grant for furloughed hours employers will need to report and claim for a minimum period of a week.

The scheme will close to new entrants from 30 June. From this point onwards, employers will only be able to furlough employees that they have furloughed for a full 3 week period prior to 30 June.

This means that the final date by which an employer can furlough an employee for the first time will be 10 June, in order for the current 3 week furlough period to be completed by 30 June. Employers will have until 31 July to make any claims in respect of the period to 30 June.

Whilst the scheme will continue the claim amounts will be reduced over a period of time.

Employers from August will be able to still claim 80% of wages (capped at £2500) but they will pay NI and pension contributions.

From September this will drop to 70% of wages capped at (£2190) with employers paying 10% of wages and contributions.

From October, this drops again to 60% of wages capped at £1875 with employers paying 20% of wages and contributions.

All in all, this means if you have been doing a three-week furlough process and then bringing the employee back to work for a period and then furloughing them again that this method will no longer work. Also whilst you can still pay furloughed staff 80% of their normal pay, from September employers will be expected to contribute.

With full details yet to be released it does seem as though this could be a positive move for directors as they could now potentially be brought back to do work while still being able to claim a grant for their 80% (and reducing sliding scale).

As with any of the schemes released during this time they are extremely fast-changing and any advice given can be very quickly out of date.

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