The Chancellor Rishi Sunak announced a series of changes to the Government’s furlough scheme at the weekend, including workers being able to go back part-time.
From Wednesday 1st July, businesses using the Government’s furlough scheme will be able to bring furloughed employees back part-time. Even if they don’t, the Government will continue to pay 80% of staff salaries during June and July.
Additionally, from August to October, while employees on furlough will continue to get 80% of their salary, who pays for that will change slightly. The amount the state pays will be reduced each month, with employers expected to contribute towards furloughed employees’ employment costs. The scheme will come to an end on 31st October 2020, as previously announced.
The key points of the update are;
- The final date by which an employer can furlough an employee for the first time is 10 June 2020 – so if an employer hasn’t furloughed employees by then and made at least one claim for furlough cash by 31st July, the employer won’t be able to access the scheme and put employees on furlough later.
- June and July: The state will continue to pay 80% of salaries, plus national insurance and pension contributions as it does now. Employers are not required to pay anything.
- August: The state will pay 80% of wages, up to a cap of £2,500/month. Employers will now have to pay national insurance and pension contributions.
- September: The state will pay 70% of wages, up to a cap of £2,190/month. Employers will have to pay national insurance and pension contributions, and 10% of wages to make up 80% of the total, up to a cap of £2,500/month.
- October: The state will pay 60% of wages, up to a cap of £1,875/month. Employers will then need to pay national insurance and pension contributions, and 20% of wages to make up 80% of the total, up to a cap of £2,500/month.
The opportunity to have staff working part time will be welcomed by many employers. From 1st July, employers can bring back employees previously furloughed for any amount of time and any shift pattern and still claim the CJRS grant for their normal hours not worked. The minimum furlough period required for reporting and claiming is one week.
We await further guidance on flexible furloughing and calculating claims which is expected to be published on 12th June. In the meantime please contact Stephen McConnell, Business Services Partner by email firstname.lastname@example.org or Tel: 028 9032 3466 if you have any queries.