Furlough extended to November

October 31, 2020

Job Retention Scheme will be extended for another month

The announcement by the Prime Minister yesterday evening (31 October) of a second lockdown in England contained confirmation that the Coronavirus Job Retention Scheme (CJRS) (the ‘furlough scheme’) would be extended until 30 November.

What this means is that the commencement of the Job Support Scheme, due to start 1 November, has been delayed until the CJRS ends.    The UK Government has confirmed that the Furlough scheme extension will apply to all UK nations,  so whether your Scottish business is legally required to close or whether your staff are able to work at least 20% of their usual hours is not relevant for November.

https://www.gov.uk/government/news/furlough-scheme-extended-and-further-economic-support-announced

Key Features of CJRS Extended:

 Employees eligible to 80% of usual wages up to a maximum of £2,500 per month;

  • The Government will cover 80% of the usual wages  (in September this had reduced to 70%, October to 60%);
  • The employer must pay employer’s national insurance and pension contributions, these are not claimable;
  • Flexible furlough will be allowed as well as full furlough;
  • Employers can top up employee wages if they wish.
  • Employee must have been on the payroll on 30 October 2020

The rules seem similar to those that were in place for August 2020 with the one key difference being that the employee could have been on the payroll at 30 October (not just on 19 March).  There is no mention in the (currently limited) guidance that the employee need to have been previously furloughed (a key condition for being flexibly furloughed before).   The methodology of calculating hours and wages will remain the same but it’s not yet clear whether usual wage is now based on that at 30 October and not February 2020.  Further detail will be issued shortly by HMRC.

In summary, the Furlough Scheme is being extended for another month and the JSS Open / JSS Closed schemes are not starting until at least December.  This change in Government support may impact on decisions on whether to keep open or temporarily close parts of your business.

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