Changes to the Coronavirus Job Retention Scheme

This article discusses the changes to the Coronavirus Job Retention Scheme which were announced recently by the Government.

Changes to the Coronavirus Job Retention Scheme

The scheme will close to new entrants from 30 June 2020. From then on, you will only be able to furlough employees that they have furloughed for a full three-week period prior to 30 June. The exception to this is employees who have been on statutory parental leave such as maternity or paternity leave.

This means that the final date by which an employer can furlough an employee for the first time would be the 10 June 2020, in order for the current three-week furlough period to be completed by 30 June 2020.

You will therefore have until 31st July 2020 to make any claims in respect of the period to 30 June 2020. It is also worth mentioning the following:

  • From 1 July 2020 the scheme will only be available if you have previously used the scheme in respect of employees you have previously furloughed
  • From 1 July 2020, claim periods will no longer be able to overlap months, if you have previously submitted claims with periods that overlapped calendar months you will no longer be able to do this going forward. 
  • The number of employees you can claim for in any claim period cannot exceed the maximum number you have claimed for under any previous claim under the current scheme
  • You can continue to make claims in anticipation of an imminent payroll run, at the point payroll is run or after payroll has been run.
  • You will be able to make their first claim under the new part-time work scheme (see below) from 1 July 2020 under the changes to the Coronavirus Job Retention Scheme

From 1 July  2020 you can pay your employee's wages and Employers National Insurance and pension costs for those hours worked. You may also claim under the scheme for the difference in normal working hours and actual working hours, subject to the claim caps (see below).

The grant currently consists of up to 80% of the salaries of employees, subject to a cap of £2,500 per month until August 2020. From 1 September 2020 this will up to 70% of salaries subject to a cap of £2,187.50. Then from 1 October 2020 it will be up to 60% of salaries subject to a cap of £1,875

From 1 July, claim periods will no longer be able to overlap months, employers who previously submitted claims with periods that overlapped calendar months will no longer be able to do this going forward.

The minimum claim period with reduce to 1 week from 1 July. This gives employers total flexibility over work rotas: all details must be agreed in writing with the employee

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.

Other points

As a condition of the scheme that, having paid furloughed staff, you  must pay all PAYE and National Insurances over to HM Revenue or your claims may be refused. This condition is not immediately clear when making a claim under the scheme so, if HM Revenue are refusing furlough claims due to unpaid PAYE and National Insurance you should contact HM Revenue to discuss your position 

For more useful information, check out our Ebooks here.

And if you'd like to know how we can help you with all of this, or with anything else, feel free to give us a call on 01202 048696 or email us at [email protected].

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