Further Extension Of The Coronavirus Job Retention Scheme

Further to our update on 2nd of November, the Chancellor has now confirmed that there will be a further extension to the CJRS until 31 March 2021, as a result the Job Support Scheme and the Job Retention Bonus have been put on hold (for now).

The Level Of Support Under The Further Extension

A policy paper was published by HMRC on 5 November 2020 which confirms that for the period starting on or after 1 November 2020 up until 31 January 2021, HM Treasury will pay 80% of the wages of furloughed employees up to a monthly cap of £2,500. Employers will pay national insurance and pension contributions (as was the case in August 2020).

The level of support available will be reviewed in January 2021 to determine whether economic circumstances have improved sufficiently to ask employers to contribute more in February and March 2021.

Other Key Information

• Detailed guidance will be published on 10 November 2020;
• Employees do not need to have been previously furloughed for the employer to access the extended CJRS;
• As previously announced, to be eligible employees must have been on PAYE payroll as of 30 October 2020 and employers must have made a Real Time Information (RTI) submission to HMRC in relation to the employee between 20 March 2020 and 30 October 2020;
• Employees on payroll on 23 September 2020 that have subsequently been made redundant can be reemployed and placed on furlough;
• The extended CJRS maintains the employer’s ability to flexibly furlough employees allowing employees to work part of their contractual working hours and be furloughed for the remainder; and
• Employees who are shielding in line with public health guidance (or those who need to stay at home with someone who is shielding) can be furloughed under the extended CJRS.

Next Steps

Extending existing furlough arrangements or re-furloughing of employees in light of the extension of the CJRS will amount to variation of the employee’s contract of employment and should be agreed with the employee. The employer is required to keep a written record of the agreement for 5 years (although the policy note states that the employee does not have to provide a written response in agreement) and a record of the hours employees work and are furloughed for 6 years.

The Geldards Employment team will publish any developments as and when they are announced. In the meantime, if you require further advice please contact a member of the team.