Update as at 9am on 10 November 2020
The Chancellor announced an extension to the availability of the Coronavirus Job Retention Scheme to 31 March 2021. The reason for the extension is based on evidence of the economic effects of COVID-19 on business lasting longer than the duration of the restrictions.
It is understood that the rules that apply from 1 November 2020 will be similar to those applicable from August 2020 but with a few exceptions. An updated or new HM Treasury Direction and guidance is due to be published today with further information.
A summary of some of the key rules and changes are:
- HMRC will publish details of employers claiming under the Scheme.
- An employer can claim for any employee provided they were on its PAYE payroll on 30 October 2020 and Real Time Information (RTI) had been submitted about the employee by that date.
- All or part of an employee’s hours can be claimed.
- The employee does not need to have been previously furloughed.
- The employer does not have to have claimed under the Scheme previously.
- The minimum claim period will remain seven calendar days.
- The government will pay 80% of the employee’s wage (up to the cap of £2,500 per month). The employer has to pay National Insurance contributions and pension contributions. This will be reviewed in January 2021 when employers may be required to contribute more. Further guidance will be published in due course regarding claims for February and March 2021.
- The employer and employee must agree to be furloughed. A written agreement must be in place.
- Claims can either be submitted in advance or in arrears for wages for 1 November 2020 to 11 November 2020 from w/c 9 November 2020.
- An employer can, if it wishes, re-employ anyone who has been made redundant and furlough them, provided they were on its payroll on 23 September 2020.
The policy paper can be found here: https://www.gov.uk/government/publications/extension-to-the-coronavirus-job-retention-scheme/extension-of-the-coronavirus-job-retention-scheme
If you have any questions or would like advice on how the Scheme applies or should be utilised in your business, please do not hesitate to contact the Employment Department.
Please note that this information is for guidance only and should not be regarded as a substitute for taking full legal advice on specific facts and circumstances.