Just after 5pm on Friday 29 May, the Chancellor announced reforms to the Coronavirus Job Retention Scheme.
The headline dates being:
- 10 June 2020 will be the last day that employers can place employees on furlough.
- From 1 July, 'flexible furlough' is being introduced, meaning employees will be able to work part-time and be furloughed part-time. Businesses will decide how that will work (in terms of the time split).
- From 1 August, employers will have to pay employee's national insurance contributions and pension contributions, and can no longer reclaim them through the CJRS.
- From 1 September, the government will only reimburse 70% of salary (up to a maximum of £2,190). Employers are required to top-up to 80% (or more, depending on what the employer agreed with the employee).
- From 1 October, the government will only reimburse 60% of salary (up to a maximum of £1,875), and employers will continue having to top up to 80% (or more).
The furlough scheme will close on 31 October 2020.
Further detail of the updates to the scheme will be provided in the Treasury Direction and the Employer's Guidance.
The scheme's timings have been 'pushed back' further than many had feared they would be. Employers are hopeful that as many jobs can be saved as possible, but inevitably some businesses will face major changes.
Chancellor Rishi Sunak is to set out details of how employers will be asked to help pay the wages of furloughed workers.