On Friday evening, 29 May, the Chancellor outlined the planned changes to the Coronavirus Job Retention Scheme. Further HMRC guidance on flexible furloughing and how employers should calculate claims is expected to be published in two weeks' time on Friday 12 June.

From 1 July 2020, (a month earlier than expected) businesses will be given the flexibility to bring furloughed employees back part time under the CJRS. Individual firms will be able to decide the hours and shift patterns their employees will work on their return and will be responsible for paying their wages while in work.

Claims from July onwards will be restricted to employers currently using the scheme and previously furloughed employees. The scheme will close to new entrants on 30 June, with the last three-week furloughs before that point having to have started on 10 June at the latest. In other words the final date by which an employer can furlough an employee for the first time will be 10 June. Employers will have until 31 July to make any claims in respect of the period to 30 June.

From August 2020, CJRS is to be slowly tapered.

The tapering means:

  • June and July: The Government will pay 80% of wages up to a cap of £2,500 as well as employer National Insurance (ER NICS) and pension contributions. Employers are not required to pay anything.
  • August: The Government will pay 80% of wages up to a cap of £2,500. Employers will pay ER NICs and pension contributions - for the average claim, this represents 5% of the gross employment costs the employer would have incurred had the employee not been furloughed.
  • September: The Government will pay 70% of wages up to a cap of £2,190. Employers will pay ER NICs and pension contributions and 10% of wages to make up 80% total up to a cap of £2,500. For the average claim, this represents 14% of the gross employment costs the employer would have incurred had the employee not been furloughed.
  • October: The Government will pay 60% of wages up to a cap of £1,875. Employers will pay ER NICs and pension contributions and 20% of wages to make up 80% total up to a cap of £2,500. For the average claim, this represents 23% of the gross employment costs the employer would have incurred had the employee not been furloughed.

Employers will be required to submit data on the usual hours an employee would be expected to work in a claim period and actual hours worked.

We await the further details on 12 June, in particular around how the pay of workers who are brought back part time sits in relation to the 80% (capped pay) requirement.