On Saturday, hours before the furlough scheme (Coronavirus Job Retention Scheme) was due to end, the government announced that we are going into a national lockdown and the scheme will be extended until December. The new lockdown period will begin on Thursday 5th November, provisionally running until 2nd December.
The original furlough scheme was supposed to end on 1st November and be replaced by the less generous Job Support Scheme (JSS). The JSS will now be delayed until December, after the extended furlough scheme ceases.
Full details are expected to be released over the next few days, but here is what we know so far.
Under the Extended Coronavirus Jobs Retention Scheme (CJRS), employees placed on furlough receive 80% of their pay, up to a maximum of £2,500 a month, in line with the support offered by the furlough scheme when it was originally introduced. This is more favourable for organisations who have recently had to top up furloughed wages by 20%, with the government paying 60%. Employers will now only cover National Insurance and Employer Pension Contributions with the government covering the 80% again.
This new extension does not require the employer to have previously accessed the old CJRS has come to an end in December. Employees can work part time on this scheme or be furloughed for the full duration and work no hours. Employees must be furloughed for a minimum period of 7 consecutive calendar days.
To be eligible for the scheme, the employee must have been on an employer’s PAYE payroll by 30th October 2020, and a Real-Time Information (RTI) submission notifying payment for that employee to HMRC must have been made on or before 30th October 2020. Employers must have a UK bank account and a UK PAYE scheme to claim the grant. The government’s previous announcement regarding giving £1,000 for every furloughed employee kept on until at least the end of January is (at the time of writing) still in place. Additionally, there is £1,500 for every out-of-work 16-24 year-old given a ''high quality'' six-month work placement.
The calculation details for the extended CJRS are still being discussed but these are expected to be similar to the previous CJRS. Employers can claim the grant for the hours their employees are not working and which they normally would have worked.
The government have confirmed that the extended CJRS will end in December in line with the end of lockdown. The JSS will then come into effect with more details on this being confirmed in November.
The government will also give organisations up to £3,000 per month under the Local Restrictions Support Grant if their premises is forced to close. A grant available to self-employed people affected by coronavirus has also been doubled to 40% of profits, with a maximum grant of £3,750 over a three-month period.
If you need any ad hoc support on the new schemes or are thinking of outsourcing your HR, Energise Consulting can help. Get in touch at info@energise-consulting.co.uk