Lockdown – Furlough scheme extended

On Saturday 31st October as employers got ready for the end of furlough, the Prime Minister announced that there would be another national lockdown.

It would start 5th November and run until 2nd December 2020, and as a result the furlough scheme would be extended. The guidance is yet to be published, but what does this mean?

Which employers can claim under the extended furlough scheme?

Employers do not have to have furloughed employees previously. Employers must have a UK bank account and UK PAYE. The rules will be similar to those under the old scheme. 

Which employees can be furloughed?

Any employee who was on payroll as at 23.59 on Friday 30 October 2020 – subject to RTI information being submitted to HMRC by that date. Therefore employees recruited over summer months could be eligible. Further, employees do not have to have previously been furloughed.

What will the furlough grant cover?

Employers will have to pay national insurance and pension contributions. The government will pay 80% of an employee’s wages subject to a cap (the original) £2,500 per month.

Can employees work whilst on furlough?

Yes, the rules around flexible furlough will remain, meaning employers will pay employees for any hours they work and furlough for the hours they do not. The calculations “will broadly follow the same methodology as currently under the CJRS” according to the government.

Do employees have to agree to be furloughed? 

Yes, the rules are expected to be the same as before, requiring a written agreement. Employers will need to update the position with employees if they were intending to use the Job Support Scheme and had communicated this to them.

What about the Job Support Scheme?

This has effectively been postponed until the end of the extended furlough scheme. But watch this space – the position is constantly changing.

Claims under the extended furlough?

Claims will have to be for a minimum 7 consecutive days. The government has stated that they will “confirm shortly” when claims can be made, and that there will be no gap in support between the end of the old and extended furlough scheme.

We await further guidance on this issue, but in the meantime for further information please contact Head of Employment Ami Naru on 0113 258 0033 or email ami@travlaw.co.uk

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