Coronavirus Job Retention Scheme Update

As the Covid-19 pandemic rolls on, many of you will be relieved to hear the chancellor’s statement on 12 May 2020 extending the 80% furlough scheme by a further four months up until the 31 October 2020. Many analysts had been predicting a reduction in support to say 60% – due to the huge cost to the government.

However, by extending the furlough to avoid a June ‘cliff-edge’ – the government continues its policy of protecting businesses and the millions of jobs they provide. Currently 7.5m employees are on furlough with 1m businesses impacted.

The chancellor has also stated that the scheme will be further adapted to allow partial return to work and retraining of staff.

Highlights:

  • Coronavirus Job Retention Scheme will continue until end 31 October 2020
  • furloughed workers across the UK will continue to receive 80% of their current salary, up to £2,500 per month
  • new flexibility will be introduced from August to allow employers to get employees back to work on a part time basis
  • support for retraining employees

Partial return to work

Currently an employee is either working, laid off or on furlough. An employee on furlough cannot carry out any work for their employer (or though they can seek other part time employment).

However, from the start of August, you will be allowed to take furloughed workers back to work part-time with employers being asked to pay a percentage towards the salaries of their furloughed staff.

The exact details are yet to be released but appears for example, that if a full time employee comes back to work for two days out of 5 days per week – the employer would contribute 40% towards the furlough scheme cost ensuring that staff continue to receive 80% of their salary, up to £2,500 a month.

Retraining

Of further interest, the government has said it will explore ways through which furloughed workers who wish to do additional training or learn new skills are supported during this period.

This could possibly be a great opportunity for employers to be very pro-active in this area and introduce new and improved working practices that will increase operational capability and efficiency – which will require staff training.  

The introduction of much needed flexibility and provision for re-training staff is extremely welcome and will help prepare the ground for firms as they reawaken, while helping those who remain in hibernation. This will be essential as the economy gradually revives – protecting the livelihood of millions.

More specific details and information around its implementation will be made available by the end of May 2020.