Update: Furlough Scheme

Chancellor Rishi Sunak has announced reforms to the Coronavirus Job Retention Scheme. We are awaiting updates to the Treasury Direction and the Employer’s Guidance – and the devil will always be in the detail – but these are the headline points announced at his press conference (with additional details from
10 June 2020 will be the last day that employers can place employees on furlough.

from 1 July, ‘flexible furlough’ is being introduced, meaning employees will be able to work part-time and be furloughed part-time. Businesses will decide how that will work (in terms of the time split).

from 1 August, employers will have to pay employee’s national insurance contributions and pension contributions, and can no longer reclaim them through the CJRS.

from 1 September, the government will only reimburse 70% of salary (up to a maximum of £2,190). Employers are required to top-up to 80% (or more, depending on what the employer agreed with the employee).

from 1 October, the government will only reimburse 60% of salary (up to a maximum of £1,875), and employers will continue having to top up to 80% (or more).

the furlough scheme will close on 31 October 2020.

the self-employed grant is being extended, with applications opening in August for a second and final grant. There will be parity with the reducing furlough scheme, paying 70% (not 80%) of average earnings up to £6,750/
M.Newman NewmanHR