This website will offer limited functionality in this browser. We only support the recent versions of major browsers like Chrome, Firefox, Safari, and Edge.

Articles

CJRS Furlough extended to 30 September 2021

By Charlie Maples

5 Mar 2021 | 2 minute read

As part of his budget, the Chancellor confirmed that the Coronavirus Job Retention Scheme (the CJRS) will be extended to 30 September 2021.

Employees who are furloughed under the CJRS will continue to be entitled to 80% of pay for hours not worked (subject to the cap of £2,500 per month). Employers will continue to contribute National Insurance and employer contributions only for hours not worked until 30 June 2021. From 1 July 2021 employers will be asked to contribute more, paying 10% of the 80% paid to furloughed workers in July 2021 and rising to paying 20% of the 80% in August and September 2021.

What should employers be thinking about as a result?

When do you anticipate bringing your remaining furloughed employees back into work? And where does that fits in the scheme in respect of employer contributions?

Whether or not you can afford, and are prepared, to contribute towards continuing furlough is an important consideration. If not, you will need to start making some decisions about the viability of those roles and planning for redundancy where you determine they are not viable.

If the looming end of furlough, and/or the reintroduction of the requirement to contribute more towards it, equates to a need for redundancies, do bear in mind:

Time needed for redundancy consultation. If you are planning 20 or more redundancies at one establishment within a period of 90 days, you need to consider collective redundancy consultation obligations. These dictate that you would need to commence consultation on 15 May 2021 (for 100 or more) or 30 May 2021 (for 20 – 99 employees) at the latest, if you want to effect redundancies before you are required to contribute more towards furlough.

The fact you can no longer claim furlough for employees who are serving notice. This could be a significant additional cost to factor into budgets that would not have been needed where you made redundancies whilst using earlier versions of the CJRS in 2020.

Have you been managing holidays for those on furlough? Employees on furlough still accrue holiday and, if they take it (or are required to take it) during furlough, they are entitled to have full normal pay for the duration of those holidays (meaning you have to top up the furlough pay). If your furloughed employees have been building up accrued leave, now is the time to think about planning a process and communication to require employees to take some or all of this accrued leave, so that they can hit the ground running once they are back in work and to benefit from some of the costs of that leave being offset by the CJRS.

Have you made use of the ability for furloughed employees to undertake training whilst on furlough? Furloughed employees can engage in training during furlough, as long as the training does not provide services to you or generate revenue for you. You also need to ensure that the furlough pay they are receiving means that they are being paid the relevant National Minimum Wage or National Living Wage for any hours spent training. If you have annual training to be completed (for example, refreshers on discrimination and harassment) and new health and safety and process training to complete, therefore, this remaining time on furlough before the employees' return is a perfect time to complete it.