Reward Strategy. Incoporating Payroll World.
Hello there,

You are viewing this article as a guest, please login or register to read more. 

Employees not previously furloughed can be claimed for under CJRS extension

Following the news of another national lockdown, the Job Support Scheme (JSS) has been postponed and the Coronavirus Job Retention Scheme (CJRS) has been extended. 

TwitterLinkedInFacebook
Employers will only be asked to cover NICs and employer pension contributions
Employers will only be asked to cover NICs and employer pension contributions

Speaking on October 31, the Prime Minister announced the lockdown would take effect from November 5 and run for at least four weeks.

 

The JSS was due to come in to place on November 1. The requirements of the scheme meant employees must be working at least 20 percent of their normal hours and would be paid for that period of working by their employer. For the remaining hours not worked, the employer would contribute five percent and the government would provide up to 61.67 percent of wages for hours not worked.

 

However, the JSS has been postponed until the CJRS extension ends. At the moment, this is said to be December.

 

Under the continued CJRS, employees can be fully furloughed or working part-time. Employees will receive 80 percent of their current salary for hours not worked, up to a maximum of £2,500.

 

Employers can also furlough employees they have not previously furloughed under the CJRS.

 

Employers will only be asked to cover National Insurance and employer pension contributions which, for the average claim, the government said accounts for just five percent of total employment costs.

 

CJRS extension details

  • This extended Job Retention Scheme will operate as the previous scheme did, with businesses being paid upfront to cover wages costs. There will be a short period when the government needs to change the legal terms of the scheme and update the system and businesses will be paid in arrears for that period.
  • The CJRS is being extended until December. The level of the grant will mirror levels available under the CJRS in August, so the government will pay 80 percent of wages up to a cap of £2,500 and employers will pay employer National Insurance Contributions (NICs) and pension contributions only for the hours the employee does not work.
  • As under the current CJRS, flexible furloughing will be allowed in addition to full-time furloughing.
  • Further details, including how to claim this extended support through an updated claims service, will be provided shortly.
  • The Job Support Scheme will be introduced following the end of the CJRS.

Who is eligible?

Employers

  • All employers with a UK bank account and UK PAYE schemes can claim the grant. Neither the employer nor the employee needs to have previously used the CJRS.
  • The government expects that publicly funded organisations will not use the scheme, as has already been the case for CJRS, but partially publicly funded organisations may be eligible where their private revenues have been disrupted. All other eligibility requirements apply to these employers.

Employees

  • To be eligible to be claimed for under this extension, employees must be on an employer’s PAYE payroll by 23:59 October 30 2020. This means a Real Time Information (RTI) submission notifying payment for that employee to HMRC must have been made on or before October 30 2020.
  • *As under the current CJRS rules:
  • 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.

What support is being provided and employer costs:

  • For hours not worked by the employee, the government will pay 80 percent of wages up to a cap of £2,500. The grant must be paid to the employee in full.
  • Employers will pay employer NICs and pension contributions, and should continue to pay the employee for hours worked in the normal way.
  • As with the current CJRS, employers are still able to choose to top up employee wages above the scheme grant at their own expense if they wish.
  • The government will confirm shortly when claims can first be made in respect of employee wage costs during November, but there will be no gap in eligibility for support between the previously announced end-date of CJRS and this extension.
TwitterLinkedInFacebook
Add New Comment
You must be logged in to comment. Login or Register to access enhanced features of the website.

You might also like

Execs fear for finance departments ability to adapt quickly

Execs fear for finance departments ability to adapt quickly


Disabled workers requests to WFH denied

Disabled workers requests to WFH denied


Will furlough affect your pay gap?

Will furlough affect your pay gap?


Pay gaps: Is the UK “good enough”?

Pay gaps: Is the UK “good enough”?

LATEST PAYROLL AND REWARDS NEWS IN YOUR INBOX

Reward Strategy homepage
Reward Strategy RSS

Member of

Did you find our website useful?

Thank you for your input

Thank you for your feedback

reward-strategy.com - an online news and information service for the UK’s payroll, reward, pensions, benefits and HR sectors. reward-strategy.com is published by Shard Financial Media Limited, registered in England & Wales as 5481132, Axe & Bottle Court, 70 Newcomen St, London, SE1 1YT. All rights reserved. Reward Strategy is committed to diversity in the workplace.
© Copyright Shard Financial Media Ltd