HM Revenue & Customs (HMRC) updated its guidance on the Coronavirus Job Retention Scheme (CJRS) to include details on how the scheme will change from 1 July to include flexible working
For June and July, the Government will pay 80% of wages up to a cap of £2,500 for the hours the employee is on furlough, as well as employer NICs (ER NICs) and pension contributions for the hours the employee is on furlough. Employers will have to pay employees for the hours they work.
The original ‘Mark 1’ version of the CJRS closes on 30 June 2020. From 1 July to 31 October 2020, it will be replaced with a revised ‘Mark 2’ version of the scheme which will allow employers to bring furloughed employees back to work for any amount of time/shift pattern, whilst still being able to claim CJRS grant for the hours not worked.
Only employees for whom a grant has been claimed previously will be eligible for additional grants under the scheme – this means they must have been previously furloughed for a minimum of three consecutive weeks between 1 March and 30 June 2020. For the minimum three consecutive week period to be completed by 30 June, the last day an employee could have started furlough for the first time was 10 June (with the exception of an employee returning from statutory paternal leave).
The number of employees an employer can claim for in any single claim period starting from 1 July cannot exceed the maximum number of employees the employer claimed for under any claim ending by 30 June.
From 1 August, the Government will pay 80% of wages up to a cap of £2,500 for the hours an employee is on furlough and employers will pay ER NICs and pension contributions for the hours the employee is on furlough. Employers will have to pay employees for the hours they work.
From 1 September, the Government will pay 70% of wages up to a cap of £2,187.50 for the hours the employee is on furlough. Employers will pay ER NICs and pension contributions and top up employee’s wages to ensure they receive 80% of their wages up to a cap of £2,500 for the time they are furloughed.
From 1 October, the Government will pay 60% of wages up to a cap of £1,875 for the hours the employee is on furlough. Employers will pay ER NICs and pension contributions and top up employee’s wages to ensure they receive 80% of their wages up to a cap of £2,500, for the time they are furloughed.
The Coronavirus Job Retention Scheme will close on 31 October 2020.
Lee Reynolds, Senior Payroll Manager said “this guidance gives us more idea of how employers will be able to furlough employees more flexibly from 1 July 2020, however, with that flexibility comes some additional complexity.”
If you would like more information, or to discuss, please call a member of our Payroll team, or email [email protected]