Following the Chancellors announcement on Friday 29 May 2020 we are able to provide a breakdown of what the furlough scheme will look like from 01 June 2020 until 31 October 2020.
01 June 2020 – 31 July 2020 – No change to Coronavirus Job Retention Scheme (CJRS)
June and July will remain unchanged, the Government will still pay 80% of furloughed salaries up to £2500 per month. This includes employers National Insurance (ER NICS) and pension contributions.
With effect from 01 July 2020 the scheme will not be available to new entrants, only employers who are already using the scheme and who have previously furloughed employees will be eligible.
The scheme will close to new entrants on 30 June 2020, with the last three-week furlough period having to commence on 10 June 2020*.
Flexible Furloughing
With effect from 01 July 2020, businesses are able to offer furloughed staff part-time hours this is known as ‘flexible furloughing’. This has been launched earlier than originally planned as the Government want to provide as much flexibility to businesses and help support people back to work quicker. There are no set guidelines about how this should look each business will make their own decisions and decide what approach works for them.
The wages of any furloughed members of staff who are brought back part time will be covered by the employer.
01 August 2020 – 31 August 2020 – Changes to Coronavirus Job Retention Scheme (CJRS)
With effect from the 01 August 2020, the Government will continue to pay 80% of furloughed staff wages up to £2500 per month, however employers will need to pay (ER NICS) and pension contributions.
The employer contribution will be the average claim, this represents 5% of the gross employment costs the employer would have incurred had the employee not been furloughed*.
01 September 2020 – 30 September 2020 – Changes to Coronavirus Job Retention Scheme (CJRS)
With effect from the 01 September 2020, the Government will pay 70% of furloughed staff wages up to £2,187.50 per month. Employers will need to pay 10% of the wages to make this up to 80% of the £2,500 cap per month. Employers will also pay employer National Insurance and pension contribution.
The employer contribution will be the average claim, this represents 14% of the gross employment costs the employer would have incurred had the employee not been furloughed*.
01 October 2020 – 31 October 2020 – Changes to Coronavirus Job Retention Scheme (CJRS)
With effect from 01 October 2020 the Government will pay 60% of furloughed staff wages up to £1,875 per month. Employers will need to pay 20% of the wages to make this up to 80% of the £2,500 cap per month. Employers will pay employers National Insurance Contributions and pension contributions.
The employer contribution will be the average claim, this represents 23% of the gross employment costs the employer would have incurred had the employee not been furloughed*.
Coronavirus Job Retention Scheme closes from 01 November 2020
For further advice on the furlough scheme, please don’t hesitate to contact your HR Consultant on 01924 827869. If you are not a client but would like to discuss options for support and advice please call one of the team on 01924 827869 and we will do our best to help you.
We are trying to keep information up-to-date but as guidance is constantly changing, please check our latest blogs and also refer to our COVID FAQ questions which you can access here.
Reference
*Directly quoted from https://www.gov.uk/government/news/chancellor-extends-self-employment-support-scheme-and-confirms-furlough-next-steps
