Within hours of the Prime Minister announcing new national lockdown restrictions for England, the UK Treasury has confirmed that the extension of the Furlough Scheme will apply across the whole of the UK, not just in England.
Employers would be forgiven for wondering why the Prime Minister couldn’t have made this clear during his initial announcement, but will be grateful HMRC have at least moved quickly to provide clarity.
Employers will have 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 which, for the average claim, accounts for just 5% of total employment costs, so the cost for employers of retaining workers will be reduced compared to the current scheme, which ends today. .
The Job Support Scheme, which was scheduled to come in on Sunday 1st November, has been postponed until the furlough scheme ends.
Many Employers will have already taken steps to end furlough for employees from next week and may have either told them to return to work under their normal contracted hours, or agreed a short-time working arrangement.
The decision to extend the Furlough Scheme shouldn’t effect any arrangements already reached with employees, but does mean the mechanism for reclaiming costs will remain the CJRS portal.
Employers unsure about how this extension to the Furlough Scheme might impact the arrangements they have made with employees should take advice to ensure they remain complaint with the Terms of the Furlough Scheme and associated employment legislation.
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