Furlough Scheme – A Reminder

Furlough Scheme – A Reminder of Important Changes

The Government updated its Coronavirus Job Retention Scheme Guidance (CJRS) on 13 November 2020 which formally extends the CJRS from 1 November 2020 until 31 March 2021.

The rules for the extended furlough scheme can be summarised as follows:

• employees will continue to receive 80% of their current salary for hours not worked, up to a cap of £2,500
• employers will be able to claim a grant and will only be asked to cover National Insurance and employer pension contributions for the hours the employee does not work
• employers are still able to choose to top up employee wages above the scheme grant, at their own expense, if they wish
• employers can still ask employees to work part-time on a flexible furlough basis and claim the grant for the unworked hours
• neither the employer nor the employee needs to have previously used the furlough scheme to be eligible
• to be eligible, employees must be on an employer’s PAYE payroll by 23:59 30 October 2020 and as before, employees can be on any type of contract
• when claiming the furlough grant for furloughed hours, employers will need to report and claim for a minimum period of 7 consecutive calendar days
• there are new tight timescales for lodging a furlough claim with HMRC. The claim has to be submitted within two weeks of the end of the previous calendar month
• The furlough scheme arrangements must be communicated and agreed in writing with employees prior to the furlough claim period
• for claim periods starting on or after 1 December 2020, an employer cannot claim for any days on or after 1 December 2020 during which the furloughed employee was serving a contractual or statutory notice period for any reason
• the Direction reiterates the purpose of furlough: to reimburse an employer who has been “adversely affected by the coronavirus…or the measures taken to prevent its transmission”. An employer must not make any claims for employees that abuse this purpose
• for all claims made from December 2020, HMRC will publish the names of those employers claiming under the furlough scheme, along with a “reasonable indication” of the amount they have claimed for
• the Coronavirus Job Retention Bonus has been withdrawn