• Facebook
  • Twitter
  • LinkedIn
Call us now: 01243 836 840   [email protected]
Pure Employment Law
  • Who We Are
    • Nicola Brown
    • Peter Stevens
    • Elena Elsam
    • David Jones
    • Linda Nye
    • Brenda Cherry
  • For Employers
    • Advice on HR and People issues
    • Investigations, Hearings and Appeals
    • Restructuring and Redundancy
    • Defending Employment Tribunal Claims
    • Dismissal of Senior Executives
    • Contracts, Handbooks and Policies
    • Employment Law Training
  • For Employees
    • Settlement Agreements
    • Workplace Issues including Disciplinary and Grievance
    • Bringing an Employment Tribunal Claim
  • Employment Law Events
  • Legal Updates
  • Testimonials
  • Vacancies
  • Contact us
  • Search
  • Menu Menu

Changes to furlough (the Coronavirus Job Retention Scheme)

30 May 2020

Coronavirus speech bubble

Yesterday evening the Chancellor of the Exchequer Rishi Sunak made his long-awaited announcement about the future of the Coronavirus Job Retention Scheme (CJRS).

We already knew from previous announcements that the scheme was due to run until October 2020 (as we covered in our previous article here) and that employers would be expected to contribute in some form from 1 August onwards. There had also been hints that in future it would be possible for employees to do some work whilst on furlough.

The key points from his announcement on 29 May were as follows:

Last date for new entrants to the scheme

Importantly, the scheme will close to new entrants from 30 June 2020. However, in practice the last date for employees to be furloughed will be 10 June, because this will allow the employee to spend 3 weeks on furlough before 1 July, which is when the rules change to allow employees to carry out some work (more details on that below).

The Government’s guidance states that after the scheme closes to new entrants “employers will only be able to furlough employees that they have furloughed for a full 3 week period prior to 30 June.” Therefore anyone who has been furloughed for at least 3 weeks previously will still be eligible for the scheme, even if they are not necessarily on furlough in the period immediately before 30 June.

The CJRS has already had a huge takeup, but with this rule change we would not be surprised to see numbers increase even further by 10 June, so that employers will ensure they have the option to use the scheme for as many employees as possible from 1 July onwards. The Government has said that “the number of employees an employer can claim for in any claim period cannot exceed the maximum number they have claimed for under any previous claim under the current CJRS.”

What were the main points about the employer’s contribution?

  • The scheme will continue with the Government reimbursing 80% of employees’ pay (up to £2,500) plus National Insurance contributions and auto-enrolment pension contributions during June and July 2020
  • For August 2020 the Government will continue to reimburse 80% of pay up to £2,500, but for the first time employers will be responsible for National Insurance contributions and auto-enrolment pension contributions. This is approximately 5% of the employment costs for each employee. (Apparently 40% of employers haven’t been claiming for this anyway).
  • Then, for September the Government’s contribution will drop to 70% of wages up to a cap of £2,190. Employers will be responsible for paying 10% of wages, plus the National Insurance contributions and auto-enrolment pension contributions.
  • For October 2020 (the last month of operation of the scheme) the Government will pay 60% of wages up to £1,875, with employers paying 20% (plus the NI and pension contributions).
  • From 1 July onwards, claims under the CJRS will not be able to overlap months, because of the rule changes above.

What do we know so far about employees being able to do some work whilst furloughed?

The Government have said that from 1 July 2020 “employers will have complete flexibility to decide on the right arrangements for them and their staff.” This is one month earlier than the Chancellor had previously thought and is being called “flexible furloughing”. The cap on the amount the Government will pay for furlough will be proportionate to the hours not worked by the employee, but how this will be calculated is not yet clear.

The Government has said that further guidance on flexible furloughing will be issued on 12 June (of course this is 2 days after the last date for new entrants to the scheme). We will of course provide further updates once that information has been released.

From what has been announced so far, it will be up to employers to decide what part-time means in terms of hours and shift patterns for when employees return to work. However, for all hours worked, the employer will be responsible for 100% of the employee’s wages.

Under the revised scheme employers will apparently be required to submit data on the usual hours an employee would be expected to work in a claim period and the actual hours that they did work. This will be more straightforward for employers who have a clocking in system, but is likely to be more complicated in organisations where there is not currently any formal method of recording employees’ working hours. We expect that some further rules will be introduced in relation to this, as on the face of it there is considerable scope for this to be abused.

Flexible furloughing will presumably involve a further change in terms being agreed between the employer and employee, which will need to be documented. Hopefully details of this will be covered in the subsequent guidance.

Will this stave off potential redundancies?

Before this announcement was made, we had already had enquiries from a number of employers who were extremely concerned by the requirement to contribute to the scheme from 1 August onwards and were having to make plans for redundancies, with a view to trying to ensure that as much of the employees’ notice periods as possible fell within the CJRS. Fortunately, the contribution from 1 August is relatively modest, and this may mean that there is a little more time. However, for some organisations even a modest contribution may be more than they can afford at the moment.

If you are dealing with any employment law issues regarding furlough and the CJRS, then we can help. Please call us on 01243 836840 for a no obligation chat, or email us at [email protected].

Please note that this update is not intended to be exhaustive or be a substitute for legal advice. The application of the law in this area will often depend upon the specific facts and you are advised to seek specific advice on any given scenario.
Share this article
  • Share on Facebook
  • Share on Twitter
  • Share on WhatsApp
  • Share on LinkedIn
  • Share on Reddit
  • Share by Mail

Join our mailing list

* = required field
Mailing Lists


Recent Legal Updates

  • Fire and rehire – what does it mean and is it lawful? 30th March 2021
  • Sleeping on the job – Sleep-in workers not entitled to National Minimum Wage 30th March 2021
  • Do your contracts need updating post lockdown? 30th March 2021
  • What are Vento bands and what are the latest rates? 30th March 2021
  • Tribunal rates and compensation limits from 6 April 2021 17th March 2021
Link to: Contact Us

Any questions? Why not get in touch!

Our advice is always given in plain English without any waffle, and we focus on providing practical solutions to our clients’ problems.

Contact us

LEGAL INFORMATION

Pure Employment Law | 1 Little London, Chichester, West Sussex, PO19 1PH
[email protected] | Tel: 01243 836840

Pure Employment Law is the trading name of Pure Employment Law Limited, registered in England and Wales with company number 07134294 and whose registered office is 1 Little London, Chichester, West Sussex, PO19 1PH. Pure Employment Law Limited is authorised and regulated by the Solicitors Regulation Authority with registration number 533794. A list of the company’s directors is available for inspection at the registered office

DISCLAIMER

The information contained in this website is for general information purposes only. The information is provided by Pure Employment Law and while we endeavour to keep the information up to date and correct, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the website or the information, products, services, or related graphics contained on the website for any purpose. Any reliance you place on such information is therefore strictly at your own risk.

Privacy Policy | Cookies Policy | Terms & Conditions | How to make a complaint | Sitemap

© Pure Employment Law 2021

Scroll to top

This site uses cookies. By continuing to browse the site, you are agreeing to our use of cookies as defined in our cookie policy.

Accept Cookie Policy

Cookie and Privacy Settings



How we use cookies

We may request cookies to be set on your device. We use cookies to let us know when you visit our websites, how you interact with us, to enrich your user experience, and to customize your relationship with our website.

Click on the different category headings to find out more. You can also change some of your preferences. Note that blocking some types of cookies may impact your experience on our websites and the services we are able to offer.

Essential Website Cookies

These cookies are strictly necessary to provide you with services available through our website and to use some of its features.

Because these cookies are strictly necessary to deliver the website, refuseing them will have impact how our site functions. You always can block or delete cookies by changing your browser settings and force blocking all cookies on this website. But this will always prompt you to accept/refuse cookies when revisiting our site.

We fully respect if you want to refuse cookies but to avoid asking you again and again kindly allow us to store a cookie for that. You are free to opt out any time or opt in for other cookies to get a better experience. If you refuse cookies we will remove all set cookies in our domain.

We provide you with a list of stored cookies on your computer in our domain so you can check what we stored. Due to security reasons we are not able to show or modify cookies from other domains. You can check these in your browser security settings.

Google Analytics Cookies

These cookies collect information that is used either in aggregate form to help us understand how our website is being used or how effective our marketing campaigns are, or to help us customize our website and application for you in order to enhance your experience.

If you do not want that we track your visit to our site you can disable tracking in your browser here:

Other external services

We also use different external services like Google Webfonts, Google Maps, and external Video providers. Since these providers may collect personal data like your IP address we allow you to block them here. Please be aware that this might heavily reduce the functionality and appearance of our site. Changes will take effect once you reload the page.

Google Webfont Settings:

Google Map Settings:

Google reCaptcha Settings:

Vimeo and Youtube video embeds:

Other cookies

The following cookies are also needed - You can choose if you want to allow them:

Privacy Policy

You can read about our cookies and privacy settings in detail on our Privacy Policy Page.

Privacy Policy
Accept settingsHide notification only