Changes to the Coronavirus Job Retention Scheme

Changes to the Coronavirus Job Retention Scheme

ARTICLE · By Timber Trade Federation · 2 June 2020

Important changes announced to the Coronavirus Job Retention Scheme by the Chancellor include the furlough scheme closing to new entrants, easing of the scheme from August, and a partial return to work for some employees.

The scheme will close to new entrants from 30 June 2020. This means that the latest date an employee can be furloughed from is 10 June 2020. This is because employees must have been furloughed for the full 3-week period up to 30 June 2020. Therefore, employees who have not been on furlough on or before 10 June 2020 will not be eligible to be furloughed in the future. Employers have until 31 July 2020 to make claims for the period up to 30 June 2020. From 1 July 2020, employees will be able to return to work on reduced hours whilst still being partially furloughed. The Government will pay 80% of employees’ regular pay for unworked hours only. Another important change is the furlough grant reducing from 1 August 2020, as the CJRS grant will no longer cover the Employer’s NI and Pension contributions. However, employees must still receive 80% pay, and the employer will need to pick up this cost. From 1 September 2020 the CJRS grant will only cover 70% of furloughed employees’ pay (up to a cap of £2,187.50). Employers must top up employees’ pay to 80% (or to £2,500 if lower). From 1 October 2020 the CJRS grant will only cover 60% of furloughed employees’ pay (up to a cap of £1,875). Employers must top up employees’ pay to 80% (or to £2,500 if lower). For those employees who have returned on reduced hours, the cap on the furlough grant/top up will be proportional to the hours not worked. For more detailed information please refer to HMRC: https://www.gov.uk/government/news/chancellor-extends-self-employment-support-scheme-and-confirms-furlough-next-steps