Covid - Furlough, Back to plan A

Just as we were gearing up for the implementation of the Job Support Scheme, Boris and Rishi manage to pull a rabbit out of the hat and grant an extension to the Coronavirus Job Retention or Furlough scheme which it was set to replace until December. And for extra pizazz, the scheme will revert to paying 80% of furloughed workers’ wages, back up from the reduced 60%, with employers only having to pay NI and pension contributions if they choose not to top-up.

And there was more to come. On Thursday, the Chancellor announced that the extended furlough scheme would be further extended to March 2021; right after we’d spent the morning discussing the terms of the Job Support Scheme with a bumper number of attendees on our Employment Law Update earlier that morning.

The initial announcement to extend furlough came at the same time we heard of the latest lockdown imposition on October 31st. It was an understandable move as the rules of the lockdown would effectively have pushed many businesses towards “JSS Closed” anyway, which would have come into effect on November 1st, the day after the announcement.

We also wonder whether the furlough extension was made to help ease the pressure on an already creaking DWP, which faced a surge in applications for Universal Credit following the anticipated job losses that the end of furlough would have meant. Ultimately, it’s tax-payers money one way or the other and the furlough scheme maintains individual’s employed status.

So the furlough scheme will continue to operate and as mentioned, salaries will be covered by the Government up to 80% with employers needing to contribute at least for National Insurance and pension payments. Some other rules of the scheme going forward are:

  • Employees need not have been previously furloughed
  • Claims can be made for employees who were on the company payroll and for whom an RTI submission was made between 20 March and 30 October 2020
  • The flexible option remains, meaning payment for those working only some of their normal hours can still be claimed
  • Employees who were made redundant after 23rd September can be rehired by their former employer and placed on furlough

As with previous iterations of the CJRS we may get some tweaks and confirmation of finer points over the coming days and weeks. In fact, with the flip-flopping of Government decisions over the past few weeks it probably something we should expect.

If there’s any potential for you to have staff furloughed over the Christmas period, you’re going to want to make sure you have your rules for holiday during furlough clarified. We expect to have our most up to date version of our Furlough Designation Letter available to download from our Toolkits by Monday to cover the latest developments.

The CJRS has been extended because we are in lockdown so let’s forget that we should be adhering to the lockdown rules, even if they’re not as strict as earlier versions. Working from home should once again become the default position wherever possible and those classed as “clinically vulnerable” should take extra care.

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