Further to our earlier post on the month-long extension of the Furlough Scheme until December (link below), Rishi Sunak has announced today (5 November 2020) that the Furlough Scheme will now be available for companies until next Spring.
The Government will continue to pay 80% of wages up to £2,500 a month for those unable to work until the end of March 2021, a year after it was first introduced. All employers will have to pay for hours not worked are the cost of employer National Insurance Contributions and pension contributions.
The chancellor’s decision was based on “the need to give businesses and people security through the winter” in the face of significant uncertainty and a worsening economic backdrop caused by the effects of Covid-19.
The policy will be reviewed in January, where, depending on restrictions in place at the time, employers may be asked to contribute more.
Since the purpose of other Coronavirus Job Schemes was to encourage employees to keep staff in work post-Furlough Scheme, the Job Support Scheme referenced in previous blog posts has been postponed because of national developments related to the coronavirus pandemic. Similarly, the Job Retention Bonus (JRB) will not be paid in February 2021 and a retention incentive will be deployed at the appropriate time.
We understand that HMRC will publish details of employers who make claims under the extended CJRS scheme, starting from December. Full guidance with further details will be published by the government on 10 November 2020.