Recent Changes to the Coronavirus Job Retention Scheme
Updated 22 June 2020
As the coronavirus situation changes constantly, so does the way our government deals with it. Thus, several recent changes have been made to the Coronavirus Job Retention Scheme for everyone's benefit.
That said, if you don't keep up-to-date with these changes, they only complicate this difficult situation even further. But don't worry: we've made it easy for you.
The list below explains all current and upcoming policy changes for July, August, September, and October of this year. These changes were officially released by the government on 12 June 2020.
What follows is the most current information available at this time about the Coronavirus Job Retention Scheme (CJRS) and what steps you need to take in response. As always, though, we will publish the newest changes right here if there are any updates in the future.
Find out all you need to know about these updates below.
First, let's look at some revised deadlines for claiming benefits with the CJRS. Most importantly, the entire program closes on 20 October 2020, as of the current revision.
All the revisions announced on 12 June will take effect from 1 July of this year. This also means you cannot make claims for any date in July until 1 July. All claims for any periods that end on or before 30 June must be submitted by 1 July.
Flexible Furlough Update
One amazing change being implemented on 1 July is the "flexible furlough update". Starting 1 July, furloughed employees no longer have to abstain from any and all work to remain eligible for claiming.
From July on, furloughed employees may return to work for their employer without canceling this eligibility. This can be the normal work/shifts the employees were performing previously or different work/shifts.
In any case, employers can now receive benefits for reduced employee hours without being forced to halt business entirely. They pay employees for the hours they work. But they also claim the grant for the total amount that employee work hours have been reduced because of COVID-19.
They only claim the difference between the amount of hours the employee used to work compared with how much they work now. Thus, employers can ease back into normal business operations without relying so heavily on government aid.
This is great news for both employers and the government. Now, the government will hopefully spend less on grants. And employers should benefit more because they're less likely to reach the monthly grant cap.
As the revisions don't apply until 1 July, there are no grant level changes during the months of June and July. Starting 1 August, though, rates will be different each month until the program closes in October.
During the June/July period, the rate stays the same as it has been since the start. The government still pays 80% of furloughed employee wages, with a cap of £2,500.
Again, this means only the hours that the furloughed employees are limited from working, not the hours they do return to work. This also includes pension contributions and National Insurance Contributions (ER NICS) that the employer pays on furloughed hours.
During the month of August, the government still pays employers 80% of furloughed employee wages, capping at £2,500. However, employer pension contributions and National Insurance Contributions (ER NICS) for furloughed hours are no longer provided by the CJRS. These expenses are once again the employer's responsibility.
This is more incentive for employers to get their staff back to work.
During September, amount of wages the government pays for furloughed hours is reduced to 70%. The cap also is reduced to £2,187.50.
Employers must still pay pension contributions and ER NICS. Plus, employees are still to receive the full 80% of their wages for furloughed hours, capping at £2,500. This means that employers will have to top up the wages of furloughed employees to pay the difference.
In October, the rate the government will pay is reduced to 60% of furloughed employee wages. The cap for this final month of the program is also reduced to £1,875.
Employers will continue to pay the pension contributions and ER NICS for furloughed hours. And they will continue to pay the difference to provide employees their due 80% of furloughed wages, capped at £2,500.
Which Employees Can Be Claimed From 1 July?
Starting 1 July, employers can only claim employees that were previously furloughed during the period from 1 March and 30 June 2020. Also, the employee must have remained furloughed for 3 consecutive weeks during this period to be eligible. So, to claim an employee from 1 July on, their furlough period must have started on or before 10 June 2020 and continued for 3 weeks.
There is one exception that concerns employees on parental leave who returned after 10 June. It may be possible to furlough these employees from 1 July if:
- Their employer has already submitted at least one CJRS claim for one or more other employees in the same organisation from 1 March to 30 June 2020
- This is the first time that the employee returning from parental leave is being furloughed
- Their parental leave began before 10 June and they returned after 10 June
- The returning employee was already on the employer's PAYE payroll on or before 19 March of this year
This is the only exception.
How Many Employees Can Be Claimed Each Period?
Starting on 1 July, the number of claimable employees per claim period is limited to the maximum number of employees previously claimed by the employer in a single claim period ending on or before 30 June. So, if 100 is the largest number of employees you claimed in one claim period ending by 30 June, you'll be able to claim 100 employees each claim period.
Keep Checking Here For Coronavirus Job Retention Scheme Updates
These benefits are here to help all of us. Don't let these confusing times be more difficult than they need to be.
Reep the benefits you deserve and get the help you need. Also, keep checking back right here to stay up-to-date with any Coronavirus Job Retention Scheme news and revisions.
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