Today, 12 May, the Chancellor announced that the Government’s Coronavirus Job Retention Scheme (CJRS) will remain open until the end of October.
The scheme will continue in its current form until the end of July, with changes to allow for more flexibility from August. The Government will be releasing further details on these changes at the end of May.
We have summarised key points from today’s announcement below:
- So far, the Coronavirus Job Retention Scheme has enabled 7.5 million roles to be furloughed, which may otherwise have been lost.
- The scheme is to be extended until the end of October 2020 and in total, will be 8 months of support given by Government to all sectors and regions across the UK.
- The Chancellor has promised those currently furloughed that they will continue to receive the current 80% of salary, capped at £2,500 per month until the end of October 2020.
- Although the amount received by employees remains unchanged, it has been announced that from August, employers will not be able to claim the full 80%. The employer will be required to fund an element of the 80% salary payment to their staff with full details on how the cost of salary payments will be shared, to be detailed in May.
- From August to October employers will be able to bring currently furloughed employees back to work on a part-time basis. The new initiative is intended to help boost the economy, whilst ensuring that there will be no reduction in financial support for those employees who are brought back to work.
- Employers will be required to fund a percentage of the salary of their furloughed staff who go back to work part-time, and this payment will substitute the contribution the Government is currently funding. Comprehensive guidance will be released to provide clarification on this complex area.
We will publish more information as soon as we have it. In the meantime, if you have any questions about the scheme, please get in touch with your usual Campbell Dallas contact.
Please also refer to our COVID-19 information hub, which is regularly updated with the latest news, insight and details of the economic support and measures as they are announced by Scottish and UK Governments.
The information in this blog should not be regarded as financial advice. This is based on our understanding on 12 May 2020. Laws and tax rules may change in the future.