The Government’s Furlough Scheme
Earlier this year, in response to the coronavirus COVID-19 crisis, the Government introduced the Coronavirus Job Retention Scheme. This was put in place to allow all UK businesses with employees on a PAYE scheme to designate those employees as ‘furloughed workers’ putting them on leave and allowing them to stay on the payroll, with the Government funding 80% of their salaries up to £2,500 a month, with the intention to assist businesses throughout the coronavirus outbreak and to prevent large scale redundancies. According to a report by the BBC, around 8.4 million workers have been furloughed since March, and by the end of May £15bn of claims had been made.
What are the latest updates announced by the Chancellor?
Following the latest furlough briefing held by the Chancellor on 29th May, it was announced there were two main changes that will take effect over the next few months.
- 10th June – After this date, employers are not able to place staff on furlough leave. This means that there is a deadline for employees to be put on to the Coronavirus Job Retention Scheme (CJRS)
- 1st July – From this date, businesses can chose to bring back furloughed employees in to the workplace part-time, a month earlier than previously announced. The amount of hours, shift-patterns and what part-time means will be down to the individual business to decide and they will be responsible to pay the wages for that time spent at work. The government will continue to pay the remaining salary contribution of the time they are not at work (still on furlough).
- 1st August – From this date, employers will be responsible for their employees’ national insurance and pension contributions and any furloughed workers will continue to receive 80% of their pay.
- 1st September – From this date, the Government are reducing their contributions and will pay 70% rather than 80% of the salary. Employers will be expected to pay the remaining 10% of their employees’ salaries, up to the cap of £2190.
- 1st October – From this date, Government contributions will further reduce to 60%, with employers contributions rising to 20%. The scheme is expected to close completely at the end of October.
How can our Employment Law Solicitors help you?
We realise that whilst the government has provided guidance on the scheme and what this means for employers and employees, it can remain confusing with plenty of unanswered questions, especially with the further updates introduced. Our experienced employment law solicitors are on hand to provide expert advice and guidance on the job retention scheme to both employers and employees, the furlough process and all aspects of employment law, including redundancy, dismissal, discrimination and employment tribunal claims.