Flexible Furlough

COVID-19; Finance & Strategy; Leadership & Culture

Allan Wilson

16.06.2020

FLEXIBLE FURLOUGH IS COMING – BE PREPARED!

The Government, has confirmed further changes to the Coronavirus Job Retention Scheme (CJRS) with the introduction of flexible furloughing as well as the increased costs to employers, from 1 August, who have furloughed employees.  Whilst it is with good intent to help employers slowly increase their direct costs, it is potentially complicated, so read carefully and get in touch if you need clarification:

Changes to the Coronavirus Job Retention Scheme
Flexible furloughing means that from 1st July employers have the flexibility to allow employees back to work for a reduced amount of time and in any shift pattern allowing them to still claim the CJRS grant for hours not worked in accordance with their employment contract. This could be really helpful to businesses who anticipate a slow start to their recovery and gives a lot of flexibility. It also means that you can keep your team engaged by bringing back more of them on shorter hours so they can get back in the groove.

Be sure to understand the rules and seek the advice of a professional wherever you’re unsure.

The Government also confirmed the timetable of changes to the furlough scheme as follows:

  • For July, the government will continue to pay 80% of wages up to a cap of £2,500 for the hours the employee is on furlough, as well as employer National Insurance Contributions (ER NICS) and pension contributions for the hours the employee is on furlough. However, employers will have to pay employees for the hours they work, as well as the associated employer NI and pension contributions.
  • For August, the government will pay 80% of wages up to a cap of £2,500 for the hours an employee is on furlough and employers will pay ER NICs and pension contributions for the hours the employee is on furlough.
  • For September, there is a further reduction with the government paying 70% of wages up to a cap of £2,187.50 for the hours the employee is on furlough. Employers will pay ER NICs and pension contributions and top up employees’ wages to ensure they receive 80% of their wages up to a cap of £2,500, for time they are furloughed.
  • For October, the government will pay 60% of wages up to a cap of £1,875 for the hours the employee is on furlough. Employers will pay ER NICs and pension contributions and top up employees’ wages to ensure they receive 80% of their wages up to a cap of £2,500, for time they are furloughed.

​More details can be found here but if you need any help deciphering it, please just get in touch.

COVID-19, flexible furlough, Furlough, Furloughing