Coronavirus Jobs Retention Scheme

This scheme enables employers to “furlough” staff i.e. to have them not working but kept on payroll, and will cover a portion of salaries as well as employer pension and National Insurance contributions. Under the scheme announced by Chancellor Rishi Sunak, employers can claim a grant covering 80% of the wages for a furloughed employee, subject to a cap of £2,500 a month. Eligible employees include full-time, part-time, agency and zero-hour contracts.

The Job Retention Scheme will now remain open until end April 2021. You can download a Treasury factsheet here.

You can read below key changes to the scheme:

  • Extended until end April 2021, with a policy review in January to assess the level of employer contribution required.
  • Eligible employees will receive 80% of their salary (up to £2.500 per month) for hours not worked, with no employer contribution to wages for hours not worked.
  • Employers will be asked to cover National Insurance and pension contributions for hours not worked.
  • Neither the employer nor the employee needs to have previously claimed / been claimed for under the existing scheme. Employees on PAYE payroll on 30 October 2020 can be claimed for.
  • Employees on payroll on 23 September 2020, who were made redundant or stopped working afterwards, can be re-employed and claimed for.

You can view the official UK Government guidance for the scheme here.

Any working hours arrangement agreed between a business and their employee must cover at least one week and be confirmed to the employee in writing. If employees are unable to return to work, or employers do not have work for them to do, they can remain on furlough and the employer can continue to claim the grant for their full hours under the existing rules.

You can get a template letter to assist with furloughing employees through the ChamberHR document library. Read a series of FAQ’s which have been compiled by Quest cover, here.

Page updated: 18/01/2020







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