Furlough scheme extended until end of April 2021, with Government contribution to remain at 80%
17.12.2020
The Chancellor announced today (17 December 2020) that the Extended Coronavirus Job Retention Scheme (the Extended CJRS), which was due to come to an end on 31 March 2021, will continue for a further month, until the end of April 2021.
In addition, the Chancellor has brought forward the review of the employer contribution element of the Extended CJRS which was due to take place in January, announcing that the Government will continue to pay 80% of furloughed employees’ salary for hours not worked until the end of April. Accordingly, the current regime will continue, whereby employers are required to cover the cost of employees’ wages, National Insurance Contributions (NICS) and pension contributions for hours worked, but only NICS and pension contributions for hours not worked.
We presume that the monthly cap on Government contributions (of £2,500 for employees who are fully furloughed and a pro rata amount for those who are flexibly furloughed) will continue to apply, but that it will remain open to employers to agree with employees that they will top up their furlough pay above the minimum requirements.
The eligibility criteria for the Extended CJRS will remain unchanged. Since the Extended CJRS is a UK-wide scheme, the changes announced today will apply across the four nations of the UK.
The Government has stated that the reason for today’s announcement was to allow businesses to plan ahead for the remainder of the winter and the New Year, giving businesses and employees greater certainty. Click here to read the full announcement.
How we can help
We anticipate that the Government will shortly update its furlough guidance to reflect today’s announcement. We will update our FAQs on the Extended CJRS and our template Full and Flexible Furlough Letters as necessary once the amended Government guidance is available.
If you are a Make UK member, please continue to contact your adviser with any queries you wish to discuss. Alternatively, non-members are welcome to call us on 0808 168 5874, or email [email protected].
Please note that Make UK offices will close at 5.30pm on Wednesday 23 December 2020 and will reopen at 8.30am on Monday 4 January 2021
The HRL National Adviceline is offering a reduced service to Make UK members over this period.
We will continue to provide regular updates on employment law developments, (both Covid- and non-Covid related) as well as ongoing advice and guidance to our members in the New Year.