Following the announcement last weekend that the Coronavirus Job Retention Scheme (“the Scheme”) would be extended until December (full details of which can be viewed here), further announcements yesterday confirmed that there will now be a further extension until 31 March 2021. This applies across the UK.
Other business support measures have also been announced or updated.
Further information about the extension of the Scheme and additional support measures are set out in the Government’s economic support fact sheet and policy paper which can be viewed at the following links:
Fact Sheet – https://www.gov.uk/government/news/government-extends-furlough-to-march-and-increases-self-employed-support (please note the link to the fact sheet appears within this news item)
The Government has stated that the Scheme has been extended in line with its primary economic priority which is to protect jobs and in recognition of the fact that businesses continue to be affected by lockdown restrictions long after such restrictions cease to apply.
Under the Scheme, eligible employees will receive 80% of their usual salary for hours not worked, up to a maximum of £2,500 gross per month. This level of support will be reviewed in January when the Government will consider whether the time is right to ask employers to contribute more.
The Job Support Scheme and the Job Retention Bonus are now both postponed although the Government stated that it will redeploy a retention incentive at the appropriate time.
Key points announced yesterday include:
- Businesses will have flexibility to use the Scheme for employees for any amount of time and shift pattern, including furloughing them full-time.
- For now, there will be no employer contribution to wages for hours not worked (unless the employer chooses to top up wages). Employers will only be required to cover National Insurance and Employer pension contributions for hours not worked.
- Where consistent with employment law, any flexible furlough or furlough agreement made retrospectively that has effect from 1 November 2020 will be valid for the purposes of a CJRS claim. However, only retrospective agreements put in place up to and including 13 November 2020 may be relied on for the purposes of a CJRS claim.
- The extended Scheme will operate in the same way as the original Scheme with businesses being able to claim either shortly before, during or after running payroll. Claims can be made from 8am Wednesday 11 November. Claims made for November must be submitted to HMRC by no-later than 14 December 2020. Claims relating to each subsequent month should be submitted by day 14 of the following month, to ensure prompt claims following the end of the month which is the subject of the claim.
- Subject to eligibility, neither the employer nor the employee needs to have previously claimed or have been claimed for under the Scheme to make a claim under the extension.
- An employer can claim for employees who were employed and on their PAYE payroll on 30 October 2020. In addition, the employer must have made a PAYE Real Time Information (RTI) submission to HMRC between 20 March 2020 and 30 October 2020, notifying a payment of earnings for that employee.
- Employees that were employed and on the payroll on 23 September 2020 (the day before the Job Support Scheme announcement) who were made redundant or stopped working afterwards can be re-employed and claimed for. The employer must have made an RTI submission to HMRC from 20 March 2020 to 23 September 2020, notifying a payment of earnings for those employees.
- Full guidance on the extension of the Scheme will be published on Tuesday 10 November.
We will update this note once further guidance on the extended Scheme is available. We are able to assist with any queries relating to furlough and flexible furlough including preparation of appropriate furlough agreements.
Taylor Walton’s employment team are available to assist employers with matters relating to the extended furlough scheme and furlough written agreements. If you have any queries relating to the issues raised in this guidance note, please contact Alec Colson in the first instance on 07711 589574 or alec.colson@taylorwalton.co.uk.