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Furlough Scheme Extended Until March

Employment Law

Following an eventful week of news and the introduction of a new national lockdown in England, the Government has announced the Coronavirus Job Retention Scheme (CJRS) also known as the furlough scheme, is to be extended further until March with employees receiving 80% of their current salary for hours not worked. The policy will be reviewed in January to assess what level of support businesses need.

The Coronavirus Job Retention Scheme was due to end on 31st October and was to be replaced by the Job Support Scheme (JSS) which delivered support based on covid alert levels across the country. However, the JSS has been postponed until the extended furlough scheme ends.

Following the announcement of new national restrictions commencing on Thursday 5th November, certain businesses and venues will again be ordered to close and other businesses may face reduced demand. The extension of the Coronavirus Job Retention Scheme aims to provide further financial support to protect jobs and businesses during this time.

The extended CJRS will be more generous for employers than it was in October, with employees receiving 80% of their current salary for hours not worked, up to a maximum of £2,500 and the cost to employers being reduced.

Under the extended furlough scheme, employers will still have the flexibility to bring furloughed employees back to work on a part-time basis or furlough them full-time, and will only be asked to cover National Insurance and employer pension contributions.

This extended Coronavirus Job Retention Scheme will operate as the previous scheme did, with businesses being paid upfront to cover wages costs, however, there will be a short period whilst the legal terms of the extended scheme and system are updated which employers will be paid in arrears for.

Additional guidance is expected to be set out by the government, however, eligibility for the extended furlough scheme remains as per the previous scheme in that employees can be on any type of contract, but must be on an employer’s PAYE payroll by 23:59 30th October 2020. Employers will be able to agree working arrangements with employees but will need to report and claim for a minimum period of 7 consecutive calendar days.

Business premises forced to close in England are also able to receive grants worth up to £3,000 per month under the Local Restrictions Support Grant.

For advice regarding any aspect of employment law please contact Martin Bloom on 01733 295 632 or email martin.bloom@hegarty.co.uk

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