The Chancellor has today announced to the House of Commons that the Coronavirus Job Retention Scheme (CJRS) will be extended until the end of March 2021, with employers only required to contribute NICs and employer pensions contributions during this time. However, there will be a review in January 2021 to see if the economic position has improved sufficiently to ask employers to contribute more.
Today’s announcement follows the announcement made on 31 October 2020 which confirmed that the CJRS would be extended until at least 2 December 2020.
The key terms of interest to employers are as follows:
- full guidance will be published on 10 November 2020 and will apply to claims for the period 1 November 2020 to 31 January 2021. Further guidance will be published for claims from February 2021 onwards following the Government’s review;
- the extension to the CJRS applies to the whole of the UK;
- claims can be made from 11 November 2020 and claims for November must be submitted by 14 December 2020; thereafter claims for subsequent months must be made by day 14 of the following month;
- the grant remains at 80% of employees’ wages for hours not worked, capped at £2,500 per month. The cap is proportional to the hours not worked. Employers may top up employee pay if they wish;
- employers will have to pay employees their wages as normal for any hours worked;
- employers do not have to have used the CJRS previously;
- employers can claim whether their business is open or closed;
- employers can claim for employees who were employed and on PAYE payroll on 30 October 2020. An RTI submission must have been made for those employees between 20 March 2020 and 30 October 2020;
- employees who were employed and on PAYE payroll on 23 September 2020 who were made redundant or stopped working for their employer after that date can be rehired and claimed for. However, an RTI submission must have been made for those employees between 20 March 2020 and 30 October 2020;
- employees can be fully furloughed or flexibly furloughed and there is no minimum furlough period;
- employees can work for another employer while on furlough, where this is contractually allowed;
- employees cannot work for their own (or a linked) employer during any hours on which they are on furlough;
- employers must confirm to their employees in writing that they have been furloughed and the terms of the agreement must reflect the hours the employee has actually worked or not worked over the period of the agreement and allow the employer to satsify the terms of the CJRS so they can make a claim in relation to hours not worked;
- furlough agreements can have retrospective effect from 1 November 2020, provided they are put in place up to and including 13 November 2020;
- the deadline for claims up to and including 31 October 2020 remains 30 November 2020.
Impact on Job Retention Bonus Scheme and Job Support Scheme
In light of the extension to the CJRS, the Chancellor has announced that the Job Retention Bonus Scheme will not take effect as its purpose falls away. However, he has said that another retention incentive scheme will be considered again at the relevant time.
The Job Support Scheme remains postponed.
Finally, the Chancellor has indicated that the government still expects the current lockdown health restrictions to end on 2 December 2020 as planned.
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