Furlough Extended to March 2021

With Furlough extended to March 2021, what does the second lockdown mean for employers?

The Coronavirus Job Retention Scheme (CJRS) has now been extended by the Chancellor of the Exchequer until end of March 2021.  He announced the furlough scheme will operate in line with the previous one.   It will provide 80% of wages up to a cap of £2,500 paid by the Government for hours not worked by the employee. The grant must be paid to employees in full.

If a flexible approach to furlough is taken, employers are required to pay employees for any hours worked. Employers funding of employers’ NICs and pension contributions applies to both the hours not worked and hours worked if any.

Our Associate Claire Rolston, Solicitor writes:Furlough Extended to March 2021

Just as we were set to welcome the Job Support Scheme on 1 November, the government has instead postponed that scheme and instead extended the existing Coronavirus Job Retention Scheme (CJRS). While we wait for the updated guidance and Treasury Direction, this bulletin from HMRC nicely summarises the scheme and gives some further detail that has not previously been reported.

Headlines are:

  • The extended scheme reflects the position in August where the government pays 80% of wages (capped at £2500) for the hours not worked and the employer pays NIC and pension contributions;
  • You do not have to have previously used the CJRS;
  • There is no gap between the CJRS and extended furlough; 
  • Employees need to be on payroll on 30 October 2020 to qualify; and
  • You can re-employ and then furlough any employee who was made redundant before 30 October as long as they were on payroll on 23 September 2020.

As before, you must agree any new working hours with employees if you are using the furlough scheme.

Furlough Extended to March 2021

If you are interested in finding out about the impact on self employment – Self-Employment Income Support Scheme (SEISS) – The level of support offered for the period covering November 2020 to January 2021 has been increased to 80%.  The maximum grant increases to £7,500.  The window for claiming this grant will open on 30 November 2020.  Our Accountants JLA Accounting have written a great blog.


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