Furlough Scheme Extended to March 2021

The Coronavirus Job Retention Scheme (“CJRS”), also known as the furlough scheme, will remain open not just until December, as originally announced by the Chancellor on 31 October, but until 31 March 2021.

From 1 November - 31 January the level of support available will mirror that available under the CJRS in August: for hours not worked by an employee, the government will pay 80% of wages up to a maximum of £2,500, with employers paying employer NICs and minimum auto-enrolment pension contributions. The extent to which employers are required to contribute to the cost of the scheme from February will be subject to review.

Full guidance on the extended scheme is due to be published on 10 November. However, we know this much from the HMRC policy paper:

  • Employers can claim even if they have not previously used the CJRS.

  • To be eligible employees must have been on the PAYE payroll on 30 October 2020.

  • Flexible furloughing is still allowed, as well as full-time furloughing.

  • Employees who have previously been furloughed continue to have their reference pay and hours based on the existing furlough calculations (as under the old scheme).

  • Employees who have not previously been furloughed will have a different pay/hours reference period. In basic terms, for those on a fixed salary, pay is based on 80% of the wages payable in the last pay period ending on or before 30 October 2020, and for those on variable pay, it is 80% of the average payable between the start date of their employment or 6 April 2020 (whichever is later) and the day before their CJRS extension furlough periods begins.

  • Employees can be furloughed if they are shielding in line with public health guidance, if they “need to stay at home with someone who is shielding”, or if they have caring responsibilities resulting from coronavirus (including a need to look after children).

  • Employees that were employed and on the payroll on 23 September 2020, who stopped working for their employer after that date can be re-employed and claimed for.

  • The Job Support Scheme and the Job Retention Bonus have been put on hold.