The Coronavirus Job Retention Scheme (CJRS), also known as the Furlough scheme is changing as of the 1st July 2020.
Shortly after the launch of the scheme, the numbers of employers using the scheme rose to 512,000 with 3.8M jobs Furloughed as of April 23rd. The latest update June 14th confirms an increase to 1.1M employers furloughing 9.1M jobs. This means that the changes taking effect on the 01 July 2020 will have a significant impact on a businesses ability to maintain the employed status of many workers. The job losses are already mounting in the UK.
Please appraise yourself of the key changes below and remember that Park City’s team of HR professionals are available to support, advise and help manage and implement the decisions you need to make in order to respond to the changes and protect your business.
Below are the key points about the change:
- 10 June 2020 was the last date you could furlough an employee who had not already been furloughed to ensure they met the 3 week period prior to the end of June.
- If an employee is returning from family leave (Maternity leave/Paternity Leave/Shared Parental Leave/Adoption Leave) and have not previously been furloughed they will still be eligible to be furloughed even after the 10 June 2020.
- All claims prior to 1 July 2020 must be made by 31 July 2020, any claims for this period will not be paid thereafter
- From 1 July 2020 you can ask your employees to return part-time and continue to furlough them for the remainder of the week
- There are no set minimum of hours you have to furlough an employee per week
- Each week the number of hours worked and furlough can vary.
- The employee must be paid for the hours worked and the hours furloughed shall then be paid 80% up to a maximum of £2,500 per month.
- For guidance on how to calculate the worked hours and furloughed hours please visit: https://www.gov.uk/guidance/calculate-how-much-you-can-claim-using-the-coronavirus-job-retention-scheme
- For July, the government will continue to pay the 80% of the furloughed hours, along with the NI and Pension Contributions
- From 1 August 2020, the employer will be responsible for the NI and Pension Contributions
- From 1 September 2020, the government will contribute 70% of the furloughed hours salary and the employer will be responsible for making up the 10% to 80% and NI and Pension Contributions
- From 1 October 2020, the government will contribute 60% of the furloughed hours salary and the employer will be responsible for making up the 20% to 80% and NI and Pension Contributions
The time to act is now before you miss an opportunity to limit your liabilities whilst you make changes. Make sure to be aware of the 7 traps when making redundancies during furlough. Contact us now if you are considering redundancies or restructuring job roles as a result of the changes listed above. Book a call or video conversation.