What employers and employees need to know about the extension of the government furlough scheme (CJRS).

Whilst the CJRS has been extended, employers and employees should pay close attention to monthly changes which are due to take effect from 1 July 2020. Employment lawyer and family office specialist Sofia Syed summarises the key points below:

  • The CJRS will shortly close to new entrants. The final date an employer can furlough an employee for the first time on the CJRS will be 10 June 2020.
  • From 1 July 2020, employers will have the flexibility to bring furloughed employees back to work part-time, whilst still remaining on the furlough scheme.
  • Employers can decide the hours and shift patterns that their employees will work, based on their own business needs. On their return to work, the employer will be responsible for paying their wages while working.
  • From August 2020, the grant under the CJRS will be slowly tapered:
    • June and July – the grant will cover 80% of wages up to a cap of £2,500 as well as employer National Insurance (ER NICs) and pension contributions for the hours the employee does not work – employers will have to pay employees for the hours they work
    • August – the grant will cover 80% of wages up to a cap of £2,500 for the hours the employee does not work, but employers will pay ER NICs and pension contributions
    • September – the grant will cover 70% of wages up to a cap of £2,187.50 for the hours the employee does not work – employers will pay ER NICs, pension contributions and 10% of wages to make up 80% of the total up to a cap of £2,500
    • October – the grant will cover 60% of wages up to a cap of £1,875 for the hours the employee does not work – employers will pay ER NICs, pension contributions and 20% of wages to make up 80% of the total up to a cap of £2,500

    This is the extent of the key information currently published, but as we know the devil is in the detail. The government has assured us that the detail will be available on the gov.uk website by 12 June 2020.

    If you have any questions arising from this KeyNote, please do not hesitate to get in touch with Sofia using the details below.

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This article is for general information purposes only and does not constitute legal or professional advice. It should not be used as a substitute for legal advice relating to your particular circumstances. Please note that the law may have changed since the date of this article.