UPDATE: RECENT CHANGES TO CORONAVIRUS FURLOUGH SCHEME

1st June 2020 by

Last month, the chancellor extended the scheme until the end of October. However, the government has announced new changes to the UK’s Coronavirus Job Retention Furlough scheme.

On the 29 May 2020 it was announced at the No 10 briefing by Mr Sunak that employers will have to start sharing the cost of the scheme.

From August, the government will pay 80% of wages up to a cap of £2,500 but employers must pay National Insurance (“NI”) and pension contributions.

In September, the government will cut the grant to 70% of wages to a cap of £2,190, which means employers will have to pay NI and pension contribution and 10 % of wages to make up the 80% total cap.

Lastly, in October the government will cut the grant to 60% of wages up to a cap of £1,875, which means that employers will have to pay NI and pension contribution and 20 % of wages to make up the 80% total cap.

Workers will also be allowed to return to work part-time from July, but with companies paying 100% of wages. The move is aimed to help and support people back to work.

The Furlough scheme will close on 30 June 2020 and new guidance to help employers understand the changes will be released by 12 June 2020. This means that anyone who has not been furloughed by 10 June 2020 will not be able to be furloughed because under the new scheme you need to furlough someone for a minimum of three weeks.

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