Furlough Scheme Extended until March 2021
As a result of the second one-month national lockdown being implemented today, the Government had no choice but to extend the Coronavirus Job Retention Scheme (Scheme) that was due to end on 31 October 2020 and be replaced by the Job Support Scheme (JSS). It was anticipated that the Furlough Scheme would be extended until 2 December 2020 in line with the second national lockdown.
However, Chancellor Rishi Sunak has today confirmed that the Scheme will in fact be extended across the UK until the end of March 2021.
The Scheme is simply an extension and so the key points are:
• The Government will pay 80% of a person’s current wage for hours not worked capped at £2,500 per month;
• Employers are still expected to pay National Insurance and Pension contributions;
• Employers who have not previously furloughed employees will be able to access the Scheme. Likewise, employees who have not been previously furloughed will also be eligible.
• The Job Retention Bonus will not be paid in February 2021 but the Government will deploy a retention incentive “at the right time”.
• Employers will have flexibility to use the extended Scheme for employees for any amount of time and shift pattern, including furloughing employees full-time.
• The Scheme will be reviewed again in January 2021 and the Government will consider whether it will be appropriate for Employers to begin contributing more.
• The extended Scheme will operate as the previous scheme did, with employers being able to claim either shortly, before or after running payroll. Claims can be made after 8am Wednesday 11 November 2020.
• The implementation of the JSS has been postponed.
Employees that were employed and on the payroll on 23 September 2020 who were made redundant or stopped working afterwards can be re-employed and the employer can make a claim under the extended Scheme.
It is essential that employers act quickly to ensure that, if necessary, employees are furloughed as soon as possible to take full advantage of the extended Scheme. It is also important to make sure that any applicable consents to furlough are reviewed and updated to reflect the extension.
If you have any questions about the extended Scheme, please e-mail Paul Kelly @ PKelly@LawBlacks.com.