Furlough Scheme - reminder
As we reported back in July, September is the first stage of the Chancellor winding down the Coronavirus Job Retention Scheme (JRS) with the scheme coming to an end in October. So far there are no plans to extend the scheme, which has so far cost £35bn with one in twelve employees benefiting.
From 1 September the grant falls to 70 percent of reference salary, subject to a monthly cap of £2,187.50.
From 1 October the grant will fall to 60 percent of reference salary, subject to a monthly cap of £1,875.
The employer must fund the difference between the reducing JRS grant and the minimum payments it is required to make to furloughed employees in respect of non-working hours. Employers must also pay employees for all the hours that they work.
It is widely thought that this will increase pressure on businesses who have not been able to return to anything like pre-covid operating profits and as such it is expected that employers will have to make tough decisions regarding staff and potential redundancies.
Posted on 11 September, 2020 by Ortolan