The Government announced in 2020 a further significant extension to the CJRS, which will now remain in place until 30 April 2021.
There will however be a review in January 2021 to determine whether employer contributions should be increased from that point.
This means that the less generous Job Support Scheme will not be introduced for the time being. The Government has also confirmed that the Job Retention Bonus Scheme, intended to reward employers who kept employees on their payrolls until at least 31 January 2021, will now not be introduced.
What financial support is available under the CJRS extension?
The level of support available under the extended CJRS is the same as available under the CJRS scheme in August. The Government will pay up to 80% of wages (up to a cap of a gross amount of £2,500); and employers will pay Employer National Insurance Contributions (NICs) and pension contributions for the non worked hours claimed under the scheme. Employers can choose to top up employee wages but do not have to do so.
Who is able to claim?
All employers with a UK bank account and UK pay as you earn (PAYE) schemes can claim the grant, although as with the original CJRS, the Government expects that publicly funded organisations will not use the scheme. Partially publicly funded organisations may be eligible where their private revenues have been disrupted.
Which employees are eligible to be claimed for?
The scheme is available in respect of employees, on any type of contract, who were on the employer’s PAYE payroll on 30 October 2020. A Real Time Information (RTI) submission notifying payment for that employee to HMRC must have been made between 20 March 2020 and 30 October 2020.
An important difference to the previous CJRS is that there is no requirement for employees to be furloughed for at least a three week period before 30 June 2020. So new employees can also be furloughed.
Is flexible furlough allowed?
Yes. Employees can be asked to work on a part-time basis and be furloughed for the rest of their usual working hours. Employers will have flexibility to use the scheme for employees for any amount of time or shift pattern and will be able to vary the hours worked in agreement with the employee.
There is no minimum furlough period. Flexible furlough agreements can last any amount of time. However, the period claimed for must be for a minimum claim period of seven consecutive calendar days.
What about employees recently made redundant?
If employees were on the employer’s PAYE payroll on 23 September 2020 (i.e. notified to HMRC on an RTI submission on or before 23 September) and were made redundant or stopped working for the employer afterwards, they can also qualify for the scheme if the employer re-employs them.
Are notice periods covered by the furlough scheme?
Only if the notice period takes place before 1 December 2020. For any days on or after 1 December 2020 during which the employee was serving a contractual or statutory notice period for the employer (this includes people serving notice of retirement or resignation, the employer cannot claim under the furlough scheme).
What about employees who are sick?
The CJRS is not intended for short-term sick absences. If, however, employers want to furlough employees for business reasons and they are currently off sick, they can do so, as with other employees.
Furloughed employees who become ill, due to coronavirus or any other cause, must be paid at least Statutory Sick Pay (SSP), but it is up to employers to decide whether to move these employees onto SSP or to keep them on furlough, at their furloughed rate.
What about employees who are shielding or who have caring responsibilities?
Employees can be furloughed where they are unable to work because they are shielding in line with public health guidance (or need to stay at home with someone who is shielding) or have caring responsibilities resulting from coronavirus, including employees that need to look after children
What about employees returning from maternity leave?
Employees returning form maternity leave need to give 8 weeks notice to end maternity early in order to be furloughed (and get furlough pay which is typically higher than Statutory Maternity Pay).
What is an employee allowed to do during furlough
As under the CJRS previously, during hours which employees are recorded as being on furlough, they cannot do any work for their employer that makes money or provides services for their employer or any organisation linked or associated with their employer. Employees can take part in training, volunteer for another employer or organisation, or work for another employer (if allowed by their existing contract of employment).
How and when can claims be made?
Employers must confirm in writing to their employee that they have been furloughed. The employee does not have to provide a written response.
Employers will be able to claim from 8am on Wednesday 11 November 2020 in respect of an employee for a minimum seven day claim window in advance or in arrears for the period from 1 November 2020 to 11 November 2020. Claims relating to November 2020 must be made by 14 December 2020. Claims relating to each subsequent month should be submitted by day 14 of the following month. Grants payments are anticipated six working days after the first claims.