Since the Government announced its support of businesses back in March, we have been told by the Chancellor Rishi Sunak to expect some changes as time progressed. This week he has announced changes to the Coronavirus Job Retention Scheme which may have an effect on you, and your business as an employer.
Changes
From 1 July 2020, under the Coronavirus Job Retention Scheme, businesses will be given the flexibility to bring furloughed employees back part-time.
This is a month earlier than previously announced.
However, please note that from July 2020 onwards this Scheme will be restricted to employers who are:
- Currently using the Scheme and have previously furloughed employees.
Important note: The Scheme will close to new entrants on 30 June, with the last three-week furloughs before that point commencing on 10 June.
In view of the need for any furlough period to last a minimum of 3 weeks, this means that the final date by which an employer can furlough a worker for the first time will be 10 June. Employers will therefore need to ensure any employees they wish to furlough and claim for under the Coronavirus Job Retention Scheme have been placed on furlough leave by 10 June.
Therefore, if there is any reason you have not made a claim yet for staff genuinely furloughed, now is the time to process a claim. Please contact a member of our team today if this applies to you and your business.
From August 2020, the level of Government grant provided through the Scheme will change.
Please see the following timeline:
June and July 2020
Currently, and for the months of June and July, the Government will pay 80% of salaries up to a cap of £2,500 (and also employer National Insurance (NICS) and pension contributions if applicable). During this time, employers are not required to pay anything and are not obligated to top up their furloughed employee salaries.
August 2020
The Government will still pay 80% of salaries up to a cap of £2,500 but employers will be required to pay employer NICS and pension contributions.
September 2020
The Governments contribution to furlough salaries will drop to 70% with a cap of £2,187.50. At this stage employers will continue to pay employer NICS and pension contributions, but also 10% of salaries to make up the 80% total up to a cap of £2,500.
October 2020
The Governments contribution will fall to 60% of salaries up to a cap of £1,875. At this stage employers will continue to pay employers NICS and pension contributions, but also 20% of salaries to make up the 80% total to a cap of £2,500.
Additional points
The Chancellor also stated:
“Employers will be required to submit data on the usual hours an employee would be expected to work in a claim period and actual hours worked”.
“Employees who believe they are not getting their 80% share can also report any concerns to the HM Revenue & Customs fraud hotline. HM Revenue & Customs will not hesitate to take action against those found to be abusing the scheme.”
If you require any further information regarding any of the Government’s Coronavirus support measures please visit HMRC’s official information site here.
Alternatively, please call a member of our dedicated team on 0208 878 8383.
