On 5 November 2020, the Government announced that the Furlough scheme has been extended until 31st March 2021.
Further to our previous update, the Government will continue to cover 80% of employees’ wages at businesses which continue to be affected by the pandemic.
The support offered to employers is set to be reviewed in January 2021, and employers’ contributions for February and March 2021 may be increased. Further guidance is expected to follow on 10 November.
What about the Job Support Scheme (‘JSS’)?
The planned JSS will now be replaced by the Furlough scheme for the time being.
Has the Job Retention Bonus been scrapped?
Yes, the Government have confirmed that their highly anticipated one-off payment to employers (£1,000 for each furloughed employee retained until the end of January 2021) will be replaced.
Not much is known about the replacement to the bonus save for it being a new ‘retention incentive’ which will be deployed at an ‘appropriate time’.
Changes to the extended scheme?
A few of the key facets of the extended scheme https://www.curzongreen.co.uk/about-us/articles/591-furlough-extended-to-december-2020-what-does-the-extended-scheme-entail.html, remain unchanged. In addition:
Employees who have previously been furloughed will continue to have their reference pay and hours based on the existing furlough calculations (as under the old scheme).
Employees who have not previously been furloughed will have a different pay/hours reference period.
For those on fixed wages the pay is based on:
80% of the wages payable in the last pay period ending on or before 30 October 2020; or
80% of the average payable between the start date of their employment or 6 April 2020, whichever is later.
For those on variable wages, the pay is based on:
80% of the average payable between the start date of their employment and the day before the extended Furlough begins.
Employees can be furloughed if they are shielding in line with public health guidance or if they need to stay at home with someone who is shielding.
Employees employed and on the payroll on 23 September 2020 who were since made redundant or stopped working for their employer after 23 September 2020 can be re-employed and claimed for under the scheme.
Full details of the scheme are set to be unveiled on 10 November 2020.
What should employers be doing right now?
With full details to follow shortly, now is the time for employers to start considering whether they want to make use of the scheme.
This update has been prepared based on the information available and the Government guidance as at 9 November 2020. Further updated guidance on this will be released today. We will provide more detailed updates in due course. We would advise you to consult the latest government guidance or contact our team for up to date advice.