The schemes are changing at a rapid pace in order to reflect the changing needs of the country during the Coronavirus pandemic. It's always worth referring back to the official government sources, such as the www.gov.uk website, however we wanted to provide a helpful update about the Furlough scheme, which has seen 8.4 million people furloughed since it was introduced in March 2020 (and when everybody started Googling what it meant!)
What's the latest on Furlough?
- Chancellor Rishi Sunak announced on 29th May that the Furlough scheme was extended until 31st October 2020. There's likely to be a further update on 12th June which provides more detail about what this means.
- The date to apply for new entrants to the Furlough scheme closed on Wednesday 10th June.
- From 1st September, salaries will be reduced to 70% and by 1st October, to 60%. This is a clear indication of the government’s desire to reduce the amount of people on the scheme.
What does flexible Furloughing mean?
The extension to the Coronavirus Job Retention Scheme (Furlough), includes improved flexibility to bring furloughed employees back part time in July, and a new taper requiring employers to contribute modestly to furloughed salaries from August. As we’ve mentioned, the government has a huge number of people on Furlough and they acknowledge that some businesses might take a while to get back up to full capacity after closing or reducing during lockdown. Flexible Furlough means you can start to bring your staff back, but on a flexible or part time basis. This will be brilliant for any business who needs to start building their business up after recent months' inactivity.
From 1 July 2020, businesses will be given the flexibility to bring furloughed employees back part time. This is a month earlier than previously announced to help support people back to work. Individual firms will decide the hours and shift patterns their employees will work on their return, so that they can decide on the best approach for them - and will be responsible for paying their wages while in work.
Find out more on the Government's website.
What about other employer contributions?
If you've got staff on your payroll and you want to know what the guidance is around the other contributions you have to make, then this is what we understand to be correct as of today (10 June 2020):
- From 1st August, employers will be expected to NOT claim for the National Insurance and pension contributions for Furloughed staff
- Employers have been contributing to the Apprenticeship Levy and this will continue.