Furlough and the Coronavirus Job Retention Scheme Update

Covid 19 business update

If your business has been affected by coronavirus (COVID-19), you can still furlough employees and apply for a grant to cover a portion of their usual monthly wages via the Coronavirus Job Retention Scheme (CJRS).

From 1 November 2020 to 30 April 2021:

  • You can claim for employees who were employed on 30 October 2020, as long as you have made a PAYE RTI submission to HMRC between the 20 March 2020 and 30 October 2020, notifying a payment of earnings for that employee.

For periods starting on or after 1 May 2021:

  • You can claim for employees who were employed on 2 March 2021, as long as you have made a PAYE Real Time Information (RTI) submission to HMRC between 20 March 2020 and 2 March 2021, notifying a payment of earnings for that employee.
  • You do not need to have previously claimed for an employee before the 2 March 2021 to claim for periods starting on or after 1 May 2021.
  • From 1 May 2021 to 30 June 2021 you can claim 80% of an employee’s usual wages for hours not worked, up to a maximum of £2,500 per month.
  • From 1 July 2021 to 31 July 2021 you can claim 70% of an employee’s usual wages for hours not worked, up to a maximum of £2,187.50 per month. You must contribute 10% of the employee’s usual wages up to £321.50.
  • From 1 August 2021 to 30th September 2021 you can claim 60% of an employee’s usual wages for hours not worked, up to a maximum of £1,875.00 per month. You must contribute 10% of the employee’s usual wages up to £625.00.
  • Throughout the whole period you can continue to “top up” your employees wages to 100%.

Employers can furlough their employees for any amount of time and any work pattern.

Remember – you must pay employer National Insurance Contributions and Pension costs.

Other Important Points

  • HMRC will check claims. Payments may be withheld or need to be paid back if a claim is found to be fraudulent or based on incorrect information.
  • You must inform employees in writing – but employee does not have to provide a written response.
  • You must keep a written record of the agreement for five years
  • You must keep records showing the amount of hours your employees work and the amount of hours they are furloughed.
  • There is no minimum furlough period, agreed flexible furlough agreements can last any amount of time. Employees can enter into a flexible furlough agreement more than once.
  • During hours which you record your employee as being on furlough, you cannot ask them to do any work for you. However you employee can take part in training and they can work for another employer without impacting on your furlough claim.
  • Furloughed employees continue to accrue leave as per their employment contract and if they take holiday whilst on furlough these hour are treated a furlough hours and should be part of your furlough claim.

Make a claim with HMRC here.