On Friday 29 May 2020, Rishi Sunak announced further details regarding the extension to the Coronavirus Job Retention Scheme (CJRS). 

Flexible furloughing

From 1 July 2020, employers can bring furloughed employees back to work part-time. The government will continue to pay 80% of the wages for any of their normal hours employees do not work up until the end of August. It is hoped this flexibility will encourage employers to get employees back to work sooner, rather than later.

The employer will also have the flexibility to decide the hours and shift patterns that employees will work on their return, but will be responsible for paying their wages in full while working. 

It is important to note that, employers must confirm any new working hour arrangement with their employees in writing. 
When claiming the CJRS grant for furloughed hours, employers will also need to:

• Report and claim for a minimum period of a week.
• Make claims for longer periods, such as on monthly or two weekly cycles.
• Submit data on the usual hours an employee would be expected to work in a claim period and actual hours worked.

If your employees are unable to return to work, or you do not have work for them to do, they can remain on furlough and you can continue to claim the grant for their full hours under the existing rules. 

Employer contributions

From 1 August 2020, the CJRS will be slowly tapered as follows:

• August 2020. The government will continue to pay 80% of wages up to a cap of £2,500 but employers will pay ER NICs and pension contributions.
• September 2020. The government will pay 70% of wages up to a cap of £2,187.50 for the hours the employee does not work – employers will pay ER NICs, pension contributions and 10% of wages to make up 80% of the total up to a cap of £2,500.
• October 2020, the government will pay 60% of wages up to a cap of £1,875 for the hours the employee does not work – employers will pay ER NICs, pension contributions and 20% of wages to make up 80% of the total up to a cap of £2,500.
• The CJRS scheme will close on 31 October 2020.

Points to note:

• For smaller employers, some or all of your employer NIC bills may be covered by the Employment Allowance, so you may not be significantly impacted by that part of the tapering of the government contribution.
• Around a quarter of CJRS monthly claims relate to wages that are below the threshold where employer NICs and auto enrolment contributions are due, and so no employer contribution will be required for these furloughed employees in August.

Important dates

The scheme will close to new entrants from 30 June 2020. From this point onwards, employers will only be able to furlough employees that have been furloughed for a full three-week period prior to 30 June 2020.

This means that the final date that you can furlough an employee for the first time will be 10 June 2020. Employers will have until 31 July 2020 to make any claims in respect of the period to 30 June 2020.

For further advice on the CJRS, contact your relationship partner. 

Please note the above is based on current guidance. This is an ever-changing landscape and if the position changes again we will update you.