Coronavirus Job Retention Scheme (CJRS) Update

Coronavirus Job Retention Scheme (CJRS) Update

The Chancellor has revised the Coronavirus Job Retention Scheme (CJRS).  It is potentially good news for employers, as it allows for more flexibility earlier than we thought we would have it and there is a sliding scale of contributions from employers to the cost of the scheme.  We’ve set out below the key elements:

  • The CJRS will still be in existence until 31 October at which point, it will cease entirely
  • During June and July, the CJRS remains the same, in that, employers are not required to contribute to the costs of the CJRS
  • Employers will be required to contribute to the costs of employee’s payments through the scheme on a sliding scale as set out below:
    • In August, employers will be required to pay the employers NICs and pension contributions
    • In September, employers will be required to pay employers NICs, pension contributions and 10% of the employee’s wage (The Government will pay 70% of employee’s wage to the usual cap of £2.5k)
    • In October, employers will be required to pay employers NICs, pension contributions and 20% of the employee’s wage (The Government will pay 60% of employee’s wage up to the usual cap of £2.5k                   Please be aware that the cap on the Furlough grant will be proportional to the hours not worked – see below for more details on flexible furloughing.
  • From 1 July (1 month earlier than was originally scheduled), employers will be able to have employees working part of a week and being furloughed for part of a week.
  • Employers have the discretion to bring back from furlough, some, all or no employees on a part time basis from 1 July.
  • If employees do come back to work, then employers will have to pay for the time that the employee is doing work, but employers will have total flexibility on the working/furlough mix
  • The final date that you can furlough an employee for the first time will be 10 June as the CJRS will close to new entrants from 30 June.  (This is an important date for you to note if your view is that the impact of coronavirus would have a somewhat delayed effect on your business and you had plans to perhaps furlough employees who hadn’t previously been furloughed from say July onwards.  This is no longer a potential option for you and you may need to change any plans you had made to furlough employees for the first time after 10 June).

The Government have told us that further guidance will be made available by 12 June.

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