The government’s Coronavirus Job Retention scheme, is currently due to end in April. However, it had been extended twice already and the chancellor may announce changes next month.
Here, Sue Dowling (pictured), a partner of Blandy & Blandy’s employment law team, looks at what the winding down scheme means for businesses.
Which employees can be placed on furlough leave?
As neither the employer nor the employee needs to have previously utilised the Furlough Scheme, employees who have not previously been furloughed can be put on furlough for the first time, on a part-time or full-time basis and with their consent, provided that the member of staff was on the employer’s PAYE payroll on October 30, 2020.
Between now and April 30, employers will also be able keep employees on full- or part-time furlough, and to place staff back on the scheme.
Employers will need to report and claim for a minimum period of seven consecutive calendar days.
It is crucial to remember that to place an employee on furlough leave, the employer should ensure that it has the employee’s written consent to go on leave and for any salary reduction that will apply as a consequence, such as only 80% of their normal salary.
The current support for employers and employees
Essentially the same arrangements will apply as did in August 2020.
For the remainder of the Scheme, the Government will continue to pay 80% of a worker’s current salary for hours not worked, up to a maximum of £2,500 (gross).
Employers will only be required to cover National Insurance (NI) and employer pension contributions and can top up an employee’s wages.
What about the Job Support Scheme and the Job Retention Bonus?
The planned Job Support Scheme, that had originally been due to replace the Furlough Scheme, has been superseded by the extended Furlough Scheme.
The Job Retention Bonus, a £1,000 one-off payment to employers who have brought back and retained workers for a minimum period, may be replaced by a new “retention incentive” to be introduced at an “appropriate time”. The Government is yet to provide further details.
Will we see further changes?
The Chancellor has confirmed that a Budget will take place on Wednesday, March 3, at which point he will “deliver the next phase of the plan to tackle the virus and protect jobs”.
No further extension of the existing Furlough Scheme, or changes to it, are currently planned.
For more details, log on to www.blandy.co.uk, or call 0118 951 6800.
