Coronavirus Jobs Retention Scheme
This scheme will enable 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, as well as employees who were made redundant since 19 March 2020 if they are rehired.
The cut off date was officially extended to 19th March on 15/04/2020. Read the article here.
Following an announcement made on 12th May, the scheme will remain open until the end of October 2020. Read the article here.
On Friday 29 May, the Chancellor of the Exchequer announced further extensions and updates to the scheme. You can read the Chancellor’s announcement in full by clicking here, and download a factsheet laying out key changes to the two schemes by clicking here.
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 British Chambers of Commerce and Quest cover, here.
The scheme is now open for claims and you can begin the process by clicking here.
We have gathered below some of the key information and guidance you will need to help make a claim:
- Check your eligibility and how much you can claim
- Step by step guide for employers
- How to calculate 80% of wages and other eligible costs
- Coronavirus Job Retention Scheme calculator (to help with the above)
Coronavirus Job Retention Scheme – extension and changes – announced 29/05/2020
The Coronavirus Job Retention Scheme will close to new entrants from 30 June, meaning that final date by which an employer can furlough an employee for the first time will be 10 June. Employers will have until 31 July to make any claims in respect of the period to 30 June.
From 1 July, the scheme will be made more flexible to enable employers to bring back furloughed employees part-time, and from 1 August, employers will have to start contributing to wage costs for furloughed staff (increasing in September and October).
From 1 July 2020, employers will have the flexibility to bring back furloughed employees on a part-time basis, with the government continuing to pay 80% of wages for any of their normal hours that they do not work up until the end of August.
Employers will decide the hours and shift patterns their employees will work on their return, and will be responsible for paying their wages in full while working, but 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.
With regards to changes in employer contributions towards the scheme, the following roadmap has been made available by HMRC:
- June / July – government will pay 80% of wages up to a cap of £2,500 including employer National Insurance and pension contributions for hours not worked; employers will pay employees for any hours they work
- August – government will continue to pay 80% of wages, employers will pay employer National Insurance and pension contributions
- September – government will pay 70% of wages up to a cap of £2,187.50 for hours not worked; employers will pay 10% of wages along with employer National Insurance and pension contributions
- October – government will pay 60% of wages up to a cap of £1,875 for hours not worked; employers will pay 20% of wages along with employer National Insurance and pension contributions
The cap on the furlough grant will be proportional to the hours worked, and more support will be made available for employers on 12 June to help calculate claims with this extra flexibility.
We understand that additional information will be made available on 12 June, to enable those eligible to start preparing to make a claim. As soon as we have this information available we will let you know.
Please note that before you start to make a claim you will need the following:
- to be registered for PAYE online
- your UK bank account number and sort code
- your employer PAYE scheme reference number
- the number of employees being furloughed
- each employee’s National Insurance number
- each employee’s payroll or employee number
- the start date and end date of the claim
- the full amount you’re claiming for including employer National Insurance contributions and employer minimum pension contributions
- your phone number
You also need to provide either:
- your Corporation Tax unique taxpayer reference
- your Self Assessment unique taxpayer reference
- your company registration number
Once you have gathered all the relevant information, you can then claim online by clicking here.
We hope this information is useful and that the process will prove to work smoothly and quickly to process any claims made. We are keen to hear your feedback on this so please do let us know if you have any issues or concerns with accessing the scheme and we will bring these to the attention of UK Government. You can email us your feedback to firstname.lastname@example.org
Page updated: 01/06/2020