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Extension of Coronavirus Job Retention Scheme

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Just as we waved a fond farewell to the Coronavirus Job Retention Scheme, so it has returned!

The Chancellor has announced this afternoon that the Scheme will remain open until 31 March 2021.

All we know at the moment is that for claim periods running to January 2021, employees will receive 80% of their usual salary for those hours not worked, up to a maximum of £2,500 per month.  This means that the Scheme is more generous than the previous one in September and October.

The 80% percentage may be reviewed for February and March 2021.

Full guidance is due to be published on 10 November 2020, so watch this space for updated guidance. So far, we know that:

  • employers can claim even if they had not previously used the CJRS.
  • employers can claim even if relevant employees had not previously been placed on furlough leave.
  • furlough leave will continue to be flexible, so employees can do some work.
  • employees who have previously been furloughed continue to have their reference pay and hours based on the existing furlough calculations (as under the old scheme).
  • employees who have not previously been furloughed will have a different reference period. Full guidance will be provided on 10 November, but broadly their pay will be based on:
    • - 80% of the wages payable in the last pay period ending on or before 30 October 2020 (for those on fixed wages), or
    • - 80% of the average wages payable between (1) the start date of their employment or 6 April 2020 (whichever is later) and (2) the day before their CJRS extension furlough period begins (for those on variable wages).
  • employees can be placed on furlough leave if they are shielding (in line with public health guidance) or need to stay at home with someone who is shielding.
  • employees that were employed and on the payroll on 23 September 2020 who were made redundant or stopped working for their employer after that date can be (but do not have to be) re-employed and claimed for.
  • the Job Support Scheme and the Job Retention Bonus have been put on hold (for now).

If you are placing employees on furlough leave under this new extension, don’t forget to get your employees’ consent, and confirm the arrangements in writing as a temporary variation to their usual contractual terms.

As always, if you have any questions please contact our employment law team.

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