The Extension of the Coronavirus Job Retention Scheme (CJRS)

By Australasian Recruitment Company – November 6, 2020

The Extension of the Coronavirus Job Retention Scheme (CJRS)

The Extension of the Coronavirus Job Retention Scheme (CJRS)

Yesterday, the Chancellor Rishi Sunak announced that the furlough scheme has been extended until March 2021. This announcement came as a relief to the many employers and workers facing uncertain times throughout a second lockdown and beyond and are in need of coronavirus support. With many alterations already made to the scheme throughout its lifetime, we’ve compiled a summary of the changes that come into effect from the 1st November 2020.

What the Government will Contribute

In previous months, the scheme has been slowly reducing the amount offered by the government in anticipation for its completion on the 30th October. However, from the 1st November the government will revert to paying all 80% of a furloughed employee’s wages for the hours they do not work.

Employers will only need to pay for the pension and National Insurance contributions for the furloughed hours, as well as paying the regular hours an employee works as usual. This arrangement will be reviewed in January and employers’ contributions may increase, subject to the economic situation at the time.

Eligibility

Employees will not have to have been furloughed before in order to be eligible. They will have needed to be on payroll on the 30th October. The government have specified that a PAYE Real Time Information (RTI) must have been submitted to HMRC between the 20 March 2020 and 30 October 2020, notifying a payment of earnings for that employee.

Furlough remains ‘flexible’, so employers can claim for any amount of time or shift pattern, full time or part time and will be able to vary the hours worked in agreement with the employee. There also remains no minimum time on the furlough period and agreements can be entered into more than once.

As the scheme was due to end, many companies had already begun making redundancies but with the announcement comes the news that employees who were on payroll on the 23rd September (including those on fixed-term contracts) and were made redundant or stopped working for the employer can be re-employed and placed on furlough.

Claiming

The furlough agreement must be confirmed in writing to the employee, reflecting the hours actually worked and not worked, but no written response is required. Employers are required to retain this agreement for five years.

The minimum claim period must be seven calendar days and only one claim can be made by an employer per calendar month. When making a claim, it is important to have to hand the actual hours worked by an employee and the hours they would have usually been expected to work.

Employers will be able to claim via the online Gov.UK portal (https://www.gov.uk/guidance/claim-for-wages-through-the-coronavirus-job-retention-scheme) from 8am Wednesday 11th November and payment will take around six working days.

If an employee has previously been on furlough, the calculation of their pay will remain the same.

For employees new to the scheme the calculation is made as follows:

  • Regular hours: the reference earnings will be 80% of the last pay period prior to the 30th October 2020
  • Variable hours: 80% of the average pay between the start date of employment or 6 April 2020 (whichever is later) and the day before their furlough period begins

Employers must keep a record of hours worked and hours furloughed for six years.

It is important to note that the closing date for current claims up to and including 31st October remains the 30th November 2020 using existing CJRS guidance.

The closing date for claims under the new extension are due the 14th day of the following month.

 

For further reference on coronavirus support see the below links:

Online Portal

Gov.UK CJRS Extension Guidance

 

If you are a candidate looking for your next temporary or permanent office support role in London, or a client requiring assistance in recruitment please contact our team so we can help you with your search at hello@australasian.co.uk

Take care, stay positive and we hope to see you soon!

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