• Barry Adams

Updates to the Furlough Scheme

From 1 July , employers can bring furloughed employees back to work for any amount of time and any work pattern, while still being able to claim the grant for the hours not worked.


From this date, only employees that you have successfully claimed a previous grant for will be eligible for more grants under the scheme. This means they must have previously been furloughed for at least 3 consecutive weeks taking place any time between 1 March and 30 June 2020.


For the minimum 3 consecutive week period to be completed by 30 June, the last day an employee could have started furlough for the first time was 10 June.


Employers will have until 31 July to make any claims for claim periods up to 30 June.

The first time you will be able to make claims for days in July will be 1 July, you cannot claim for periods in July before this point.


The number of employees you can claim for in any claim period starting from 1 July 2020 cannot exceed the maximum number of employees you claimed for under any claim ending by 30 June 2020.


From 1 August 2020, the level of grant will be reduced each month. To be eligible for the grant, employers must pay furloughed employees 80% of their wages, up to a cap of £2,500 per month for the time they are being furloughed.


The timetable for changes to the scheme is set out below. Wage caps are proportional to the hours an employee is furloughed. For example, an employee is entitled to 60% of the £2,500 cap if they are placed on furlough for 60% of their usual hours:


· There are no changes to grant levels in June.


· For June and July, the government will pay 80% of wages up to a cap of £2,500 for the hours the employee is on furlough, as well as employer National Insurance Contributions (ER NICS) and pension contributions for the hours the employee is on furlough. Employers will have to pay employees for the hours they work.


· For August, the government will pay 80% of wages up to a cap of £2,500 for the hours an employee is on furlough and employers will pay ER NICs and pension contributions for the hours the employee is on furlough.


· For September, the government will pay 70% of wages up to a cap of £2,187.50 for the hours the employee is on furlough. Employers will pay ER NICs and pension contributions and top up employees’ wages to ensure they receive 80% of their wages up to a cap of £2,500, for time they are furloughed.


· For October, the government will pay 60% of wages up to a cap of £1,875 for the hours the employee is on furlough. Employers will pay ER NICs and pension contributions and top up employees’ wages to ensure they receive 80% of their wages up to a cap of £2,500, for time they are furloughed.


Employers will continue to able to choose to top up employee wages above the 80% total and £2,500 cap for the hours not worked at their own expense if they wish.


Employers will have to pay their employees for the hours worked.


The table shows Government contribution, required employer contribution and amount employee receives where the employee is furloughed 100% of the time.


Wage caps are proportional to the hours not worked.

The Coronavirus Job Retention Scheme will close on 31 October 2020.


For more information, including how to calculate your claim and much more, you can always contact us, or go to the HMRC website.

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