Posted: 04 / 11 / 2020
Under the Coronavirus Job Retention Scheme (CJRS), the Government announced that employers will be able to claim a grant from 1 March to cover 80 per cent of employees’ salaries up to a maximum of £2,500 per month.
This scheme originally ran until 30 June. It was then extended until the end of October, with changes effective from 1 July.
The scheme has been extended again with the Government paying 80% of wages for the hours of furloughed employees up to a cap of £2,500 for periods from 1 November 2020. The scheme will only cover wages, meaning employers will be responsible for paying employer National Insurance contributions and employer pension contributions. As with the previous versions of the scheme, employers can choose to top up furloughed employees’ wages beyond the 80% paid by the government.
Who is eligible?
All employers with a UK bank account and UK PAYE schemes can claim under the scheme. Neither the employer nor the employee needs to have previously used the CJRS.
To be eligible to be claimed for under this extension, employees must be on an employer’s PAYE payroll by 23:59 30th October 2020. This means a Real Time Information (RTI) submission notifying payment for that employee to HMRC must have been made on or before 30th October 2020.
Employees can be on any type of contract. Employers will be able to agree any working arrangements with employees.
Employers can claim the grant for the hours their employees are not working, calculated by reference to their usual hours worked in a claim period. Such calculations will broadly follow the same methodology as currently under the CJRS.
When claiming the CJRS grant for furloughed hours, employers will need to report and claim for a minimum period of 7 consecutive calendar days.
Employers will need to report hours worked and the usual hours an employee would be expected to work in a claim period.
For worked hours, employees will be paid by their employer subject to their employment contract and employers will be responsible for paying the tax and NICs due on those amounts.