The Government’s employee job-protection scheme, the Coronavirus Job Retention Scheme (“CJRS”), will be changing with effect from 1 July. Although we’re still awaiting full published guidance regarding the changes, we have summarised below the key points from the latest announcement:
- The CJRS will close to new entrants on 30 June. Therefore, from 1 July, a business will only be able to claim for employees if they have been furloughed for a full three-week period at any time before the end of June. This means that if a business intends to furlough and claim support for an employee who hasn’t been furloughed before, they will need to furlough the employee by 10 June at the latest to ensure the minimum three-week period is complete by 30 June.
- From 1 July, businesses may bring furloughed employees back to work part time. Should they do so, the business will cover the full costs of the employee wages for the time that they are working, and can claim a grant under the CJRS for the remaining furlough period. If employees are unable to return to work, or employers do not have work for them to do, they can remain on furlough and the business can continue to claim the grant for their full hours under the existing rules.
- From August, support provided via the CJRS will gradually be tapered and employers will be required to contribute towards employee wage costs, as follows:
August – the Government will pay 80% of wages (up to a cap of £2,500). Employers will pay 100% of the associated Employer’s National Insurance Contributions and pension contributions
September – the Government will pay 70% of wages (up to a cap of £2,187.50). Employers will pay 10% of wages to make up 80% of the total (up to a cap of £2,500), and 100% of the Employer’s National Insurance Contributions and pension contributions
October – the Government will pay 60% of wages (up to a cap of £1,875). Employers will pay 20% of wages to make up 80% of the total (up to a cap of £2,500), and 100% of the Employer’s National Insurance Contributions and pension contributions
In further news, the Government has also announced plans to extend the Self-Employment Income Support Scheme (SEISS). Eligible self-employed individuals will be able to claim a second and final SEISS grant in August, covering June – August, worth 70% of their average monthly trading profits (capped at £6,750 in total).
Please note that the eligibility criteria and claim process will be the same as for the first grant but individuals do not need to have claimed the first grant to claim the second, for example if the business has more recently been adversely affected by COVID-19. For those yet to claim the first SEISS grant, the deadline for claiming is 13 July.
If you have any questions regarding these changes please feel free to contact us.