The Coronavirus Job Retention Scheme (CJRS) is being extended until 31st March 2021.
This is what we know so far before the full guidance is published on 10th November:
The scheme rules are predominantly the same with a few revisions.
Employees will receive 80% of their usual salary for any unworked hours for claims running to January 2021. The policy will be reviewed by the government in January to decide if employers will be asked to contribute more. Until January, the employer contributions will be the same as they were in August 2020, with NI and pension contributions being paid for any hours that aren’t worked. The £2,500 monthly cap remains in place but employers can still top up their employees wages at their own expense.
As an employer, you can claim under the CJRS extension even if you haven’t previously used the CJRS, regardless of whether your business is open or closed.
New employees who were on the payroll on 30th October 2020 can be claimed for as long as they are on a Real Time Information (RTI) submission between 20th March and 30th October 2020.
The scheme can be used for employees on any shift pattern and for any amount of time on either a full time or part time basis and hours worked can vary in agreement with the employee. The employee can be on any type of employment contract and does not need to have been furloughed previously.
Those employees that were furloughed previously must have their pay calculated in the same way as it was under the original CJRS. Any employees who were not eligible for the previous scheme but meet the eligibility for the for the extended scheme (for example, new employees) must have their pay calculated using the alternative calculations.
These alternative calculations state that:
- for those employees on a fixed salary, 80% of their wages should be calculated based on the wages paid in the last pay period ending on or before 30th October 2020
- for those employees whose pay varies, the 80% calculation should be the average pay between 6th April 2020 or their start date, if it is later and the day before the furlough begins under the extension scheme
If an employee was eligible for the original scheme, even if a claim was not made for their wages, the 80% calculation must be made in accordance with the original guidance. It is only where an employee was not eligible under the scheme to 31st October that the updated reference periods should be used. Full details of the new calculations will be available from 10th November.
The Job Retention Bonus
The Job Retention Bonus (JRB) will not be paid in February as initially intended as the purpose of the JRB no longer applies due to the extension of the CJRS until 31st March 2021. The bonus was intended to encourage employers to keep people in work until the end of January so an alternative retention incentive will be implemented at a later, more appropriate time.
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