The Coronavirus Job Retention Scheme (CJRS) allows employers to furlough employees and receive a grant that covers 80 per cent of employees’ salary costs. What happens when the support starts to taper off?
From 31 July 2020, the government’s financial support with the CJRS will begin to taper in the following stages:
From 1 August 2020, employers must begin to pay their employees’ National Insurance and pension contributions. These cannot be reclaimed:
Since 1 July 2020, the Government has Enabled Employers to Operate a "Flexible Furlough" Scheme. What is it?
Under the scheme, employers may bring their employees back to work on a part-time basis, paying 100 per cent of their wages on the day(s) they work. On the days when their employees are not working, employers are still eligible for furlough support under the CJRS, on a pro-rata basis.
This option enables employers and employees alike to incrementally return to a normal pattern. Furloughed employees get to transition back to their working routine and employers are able to pay a greater proportion of their staff’s wages according to their cashflow.
What are the Pros and Cons of Flexible Furlough?
Intelligent use of the flexible furlough scheme may enable employers to drip-feed employees back into the workplace to assist with the implementation of "COVID-secure: measures and prepare for a full return of their workforce.
Different employees can be selected for flexible furlough from week-to-week, ensuring fairness.
A downside of the scheme is that claiming eligibility can be complicated, with employers required to track their employees’ working hours meticulously.
For example: If an employer claimed for ten days’ furlough support for an employee but circumstances changed, the employee worked more hours and only eight days’ support was required – the employer would need to be diligent and make the necessary adjustments to their calculations to avoid making a fraudulent claim.
What Financial Help is Available When the CJRS Concludes in October?
Full terms and conditions for the loans can be found on the Gov.uk website.
What options other than redundancy do employers have if it’s not possible to bring employees back on full pay after 31 October 2020?
“Redundancy is often the first or only option considered, but it should only ever be a last resort and there are a number of other options to consider first. It’s important to note that most of these will involve varying the employee’s terms and conditions which necessitates consulting with them and obtaining their agreement.”
Senior HR Consultant, HeadsTogether
Angela Barratt, Senior HR Consultant at HeadsTogether, discussed this topic with ThisWeekinFM. She mentioned the following options that employers – if they’re interested in implementing any of these - should take appropriate advice on, relative to their individual circumstances:
Picture: A photograph showing two people in discussion whilst sitting at a desk.
Article written by Cain Smith.