In the Budget last week, the Chancellor announced that he would be extending the Coronavirus Job Retention Scheme for a further five months.
The Coronavirus Job Retention Scheme (Furlough) will now be an available option for businesses until 30 September 2021. Furloughed employees will continue to receive 80% of their current salary for hours not worked, up to a maximum of £2,500 per month.
Employers can once again choose whether to only pay NI contributions and pension costs, or to top up the 80% paid by the Government. The CJRS furlough grant for May and June will remain at 80% of the employees’ usual pay for hours not working. However, from July 2021, as the economy reopens we will see the staged approach return. It will then be limited to 70% for July and then 60% for August and September.
This will operate in a similar way to before with the employer being required to contribute the remaining 10% and then 20% of an employee’s regular pay so that they continue to receive 80% pay for furloughed hours. In addition to this the employer will still be responsible for paying employer’s national insurance and pension contributions on the full amount being paid to employees not the 80%.
The previous Furlough rules still apply. You can still furlough full-time, part-time, agency, flexible or zero-hour contracts, but the employee must have been on your payroll before the extension was announced. Those furloughed now do not have to have been furloughed before. Annual leave entitlement and parental leave entitlements remain.
Some of our previous blogs which outlined how to use the Furlough Scheme may still be useful:
Furloughed employees – What redundancy payment are they entitled to?
Furlough Leave in state funded and mainstream schools
You can find out more about the scheme on this link
Other news in the budget
NI Rates
The national insurance contribution (NIC) rates and bandings were announced in December but take effect from 6 April 2021. Please note that employer contributions will apply to earnings over £170 per week, £8,840 per annum which is a £1 a week increase. Click here to see the full rates.
Apprenticeships
The current apprenticeship scheme has been improved and will run until 30 September 2021. Employers will receive £3,000 for each new apprentice they hire aged under 25 and £1,500 for each new apprentice aged over 25. There will be also be a new “flexi-job” apprenticeship from January 2022, which will allow individuals to work for more than one company via an agency. You can find out more here.
Please get in touch with the team if you need help in regards to furloughed staff, contracts, redundancy process or necessary notice. Our HR Consultants are more than happy to assist you phone 01924 827869 or contact us for more information.
