HM Insights

Coronavirus Job Retention Scheme extended until October

Correct as of 12th May 2020

As employers will be aware, the Coronavirus Job Retention Scheme (the Scheme) is now live and operational. We have provided updates when the scheme was first announced, when further guidance was issued on 26 March 2020on 6 April 2020, on 8 April 2020 as further details were announcedon 9 April 2020, on 15 April 2020 as the scheme expanded in scope and when the scheme went live on 20 April 2020.

The Chancellor Rishi Sunak was today (12 May 2020) in parliament to answer an urgent question from the Shadow Chancellor on the economic support offered by Government in response to the crisis. During the announcement the Chancellor announced that the scheme will be extended until the end of October.

He revealed that the Scheme will continue until the end of July in its current form, however there will be changes to the Scheme from August until October. The details of those changes are not yet confirmed but a commitment was made that these will be announced before the end of May.

Coronavirus-legal-updates-2020.jpg (1)

What will the extended furlough scheme look like?

The Chancellor committed that those on furlough will continue to receive 80% of their wages or £2500 per month whilst furloughed, but suggested that employers will have to contribute to this. It is not yet clear what level of contributions employers will have to make and it is expected this will form part of the announcement by the end of May.

This announcement is slightly different from the speculated reduction of the support under the scheme to a level of 60%; it remains to be seen if this 20% difference is the employer contribution mentioned by the Chancellor.

It was also intimated that the flexibility of the Scheme will increase with employees able to brought back on a part-time basis, - however, again, how this will work in practice will not be known until further announcements are made or guidance provided.

Once further details of these changes are announced we will provide a further update on the Scheme; however, in brief what we now know is as follows:

  • Scheme continues in current form for an additional month, until the end of July, including 80% pay up to £2500 cap.
  • Thereafter, changes from August until October.
  • Part time working and employer contributions seem to form at least part of the envisaged changes.

Get in touch

If you've any queries about this, or any other employment related matter that could affect your business, our team of specialist employment lawyers can assist. Please contact us on 0131 247 2534 to discuss further.

Useful links

CORONAVIRUS LEGAL ADVICE

EMPLOYMENT LAW FOR EMPLOYEES

EMPLOYMENT LAW FOR EMPLOYERS