The furlough scheme is changing and tomorrow, 10th June 2020.
From the 1st July 2020, if an employee or director hasn’t been furloughed under the current scheme i.e. furloughed for 3 full consecutive weeks, you will not be able to make a furlough claim for that employee or director under the revised furlough scheme from 1st July 2020 onwards.
This means that the final date that you can furlough an employee for the first time will be 10 June for the current three-week furlough period to be completed by 30 June. Employers will have until 31 July to make any claims in respect of the period to 30 June.
This means that the last day an employee or director can start their first 3 week furlough period, and remain eligible under the new scheme is tomorrow 10th June.
If you are using the furlough scheme, please see below of how the furlough scheme is changing.
|Date||Government Funded||% Employer Contribution||Pension Funded||Employers NIC||Employee Return to Work Basis|
|01 June 2020||80%||Gov Funded||Gov Funded||Gov Funded||None|
|01 July 2020||80%||Gov Funded||Gov Funded + Employer||Gov Funded + Employer||Part time|
|01 August 2020||80%||Gov Funded||Employer||Employer||Part time|
|01 September 2020||70%||10% Employer + 60% Gov Funded||Employer||Employer||Part time|
|01 October 2020||60%||20% Employer + 50% Gov Funded||Employer||Employer||Part time|
It’s important to note that the scheme will close to new entrants from 30 June.
Detailed guidance on the revised furlough scheme is due to be published this Friday 12th June.
As you can see from the above table, the government grant provided through the job retention scheme will be slowly reduced as from August 2020.
- In June and July, the government will pay 80% of wages up to a cap of £2,500 as well as Employer National Insurance and pension contributions ONLY for the hours the employee doesn’t work – employers will have to pay employees for the hours they work.
- In August, the government will continue to pay 80% of wages up to a cap of £2,500 but employers will now have to start paying Employer National Insurance and pension contributions.
- In September, the government contribution now reduces to 70% of wages up to a cap of £2,187.50 for the hours the employee does not work – employers will pay Employers National Insurance, pension contributions and 10% of wages to make up to 80% of the total up to a cap of £2,500
- In October, the government contribution will reduce further to 60% of wages up to a cap of £1,875 for the hours the employee does not work – employers will pay Employer National Insurance, pension contributions and 20% of wages to make up to 80% of the total up to a cap of £2,500
- The cap on the furlough grant will be proportional to the hours not worked.
If you have any queries, please get in touch.
In the meantime, stay safe and well.
Further guidance can be found:
If you need any further support please see what services we can offer to help you.
Written by: Jenny Neale
J A Neale
9th June 2020