The Government Furlough Scheme – major changes

Furlough changes

The Government Furlough Scheme – a further update for employees, employers and businesses

The Furlough Scheme introduced by the Government to assist Employers and employees with up to 80% of their monthly salary payments has proved to be a major success.

Nearly 10 million employees are being paid via the scheme, approximately 1 in 4 people, which is costing the Government far in excess of their original estimates with almost £20 billion claimed to date from Employers

The scheme was extended beyond its original cessation date to July, and now to October but as a result of the final costs of providing the assistance, the Government has just announced a major upheaval to the Scheme and it means big changes.

A summary of the major changes to the way that you manage your Furlough are as follows:

  • From August, you must pay National Insurance and pension contributions for furloughed staff.
  • Then, you must contribute 10% of pay from September and 20% of pay from October.
  • From July, you can bring furloughed employees back part-time and claim grants for the hours your employees are not at work, to a set limit.
  • The Job Retention Scheme will close to new applicants on the 30th of June. If you want to put any new employees on furlough, you must do so by the 10th of June.

While the government isn’t set to close the Job Retention Scheme until October 2020, these new measures mean you’ve just a few days until 10th June to decide to furlough someone for the first time so you really must act now before it is too late.

Should you require any advice and guidance around this matter, or anything else in relation to help and support available to businesses during the Coronavirus pandemic – things like Bounce Back Loans then please do not hesitate to get in contact with us.

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