The Extended Furlough Scheme part 1

By November 2, 2020Payroll Outsourcing

The Extended Furlough Scheme

The furlough scheme is to be extended for a further month from the 1st November 2020.  The basis will be similar to August; the employee will receive 80% of their reference salary up to £2500 per month and the employer will be reimbursed for this amount.  The employer will need to pay the employer’s National Insurance and pension contributions although the Employment Allowance will be available to offset the NI.

Job Support Scheme

The Job Support Scheme was due to come into effect on Sunday 1st November but will be postponed until the furlough scheme ends.  The government have left the doors open to extend the furlough scheme further if they think it is needed, so currently there is no date for when this new scheme might be introduced.

The furlough scheme is more generous than both Job Support Scheme (open) and (closed) which offered up to 66.67% of salary for hours not worked and with a lower cap.  With JSS (open) the employer was also expected to contribute a small amount to the hours not worked as well.

Coronavirus Job Retention Scheme Extension – The Extended Furlough Scheme

Seven consecutive days is the minimum time a worker can be furloughed.  For workers with reduced hours due to the COVID pandemic the flexible furlough scheme will also still be allowable.  We have a template to assist with calculating and checking flexible furlough.

All employers will be eligible and you do not need to have claimed for furlough previously to qualify. Publicly funded employers should not claim under this scheme.  Employees can be furloughed from November even if they have not previously been furloughed.

Employees will need to have been on the payroll and reported via a Real Time Information (RTI) submission before the end of October to be able to claim.  It is important to note that a start date is not mentioned, it is the fact that the employee was on a payroll and with RTI submitted prior to the end of October.

The amount to claim is 80% of the usual hours that are not worked and details will follow with the method to calculate what are usual hours and pay.

Full details have been promised to follow shortly.

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