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Just when we all thought that furlough was definitely going to end, we’re faced with a second national lockdown and the Chancellor announces an extension to furlough until the 31st March 2021.
Key points on the extended furlough scheme are:
• Furlough scheme is extended to 31st March 2021
• Pay returns to August payment levels i.e. 80% of salary capped at £2,500 a month
• Employer pays NI and pension – estimated by HMRC to be 5% of salary costs
• Employee to be put on furlough needed to be on payroll as at 23.59 (precisely) on 30th October to qualify
• New employees who qualify via payroll can be put on furlough
• Full or flexi furlough remains possible
• As before claims to HMRC to be made on a consecutive 7 calendar day basis
You may have already arranged for employees to return from furlough anticipating the end of furlough and may now wish to take advantage of the extended scheme especially if that delays redundancy procedures. If you do, review your furlough agreements/arrangements may need updating to reflect flexi furlough or return to full furlough. If you need assistance with this, our employment team are happy to assist.
Keep in mind that furlough is a variation of contract so important to keep records up to date and HMRC expect records to be kept for 5 years.
Furloughed employees remain employed, continue to accrue holiday during furlough, can take sick leave and holiday leave during furlough, cannot work but can do training and voluntary work.
Furloughed employees can do another job i.e. a second job so long as not breaching contract of employment with another employer or existing job they are furloughed from.
The Job support scheme is now postponed pending the end of furlough; and it may be subject to change.
Employers were originally encouraged to keep people in work until the end of January 2021 to receive a Job Retention Bonus (JRB) of £1,000 per head. However, this has now been scrapped as the furlough scheme has been extended.
For assistance with furlough, redundancy procedures or other employment issues, contact our Employment team on 01689 887840.