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Update On Changes To Furlough

Further details have been produced by the government regarding Furloughing of staff:

Furlough Scheme:-

As from 30th June 2020 the scheme will close to new entrants.  From 1st July 2020 the scheme will be made more flexible.  From 1st August 2020 you will have to start contributing towards the wage costs of paying your furloughed staff and this will increase in September 2020 and October 2020.  As from 30th June 2020 you will only be able to furlough staff that were furloughed for a full three periods prior to this.  This means the final date on which you can furlough an employee for the first time will be 10th June 2020.  

From 1st July 2020 businesses using the scheme will have the flexibility to bring previously furloughed employees back to work part time.  The government will continue to pay 80% of their wages for their normal hours they do not work up to the end of August.

You,as an employer, will decide the hours and shift patterns the employees will work on their return and will be responsible for paying their wages in full while they are working.  This means employees can work as much or as little as the business needs.  When claiming the furlough you will need to report and claim for the minimum period of a week.  You can choose to make claims for longer periods if preferred.  If employees are unable to work, you can still furlough them and you can continue to claim the grant for the full hours.  

Employers Contribution:- 

From 1st August 2020 the furlough system from the government will slowly be reduced.  They will continue to pay 80%of wages up to the normal cap of £2,500 but you will pay the employers NIC and Pension contributions (approximately 5% of the gross employment costs). 

From 1st September 2020 the government pays 70% of wages up to a cap of £2,187.50 for the hours employed but not worked.  As above, you will pay the employers NIC and Pension contributions and 10% of the wages.

On 1st October 2020 the government will pay 60% of wages with a cap of £1,875 for the hours the employee does work.  Again,as above, you will pay the employers’ NIC and Pension contributions but 20% of wages to make it 100%.

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