Overdue details of the Job Retention Bonus were published by the Treasury and the Government last week. We summarise what the bonus is and the key considerations below.
How much is it?
£1,000 for each eligible employee that you furloughed and continue to employ through to 31 January 2021.
Which workers can I claim the CJRS bonus for?
- you furloughed under the CJRS at some point (including employees who have transferred to you under TUPE – but you must have furloughed and made a claim for them under the CJRS);
- you kept in employment between your last CJRS claim and 31 January 2021;
- are not working their notice at 31 January 2021; and
- were paid the minimum earnings threshold – which is at least an aggregated total of £1,560 gross across the tax months Nov/Dec 20, Dec 20/Jan 21 and Jan/Feb21 (counting from the 6th of each month).
You will also be eligible to apply for the JRB in respect of employees for whom you are claiming under the new Job Support Scheme, providing they meet the above criteria.
However, note that you will be excluded from applying for the bonus in respect of any employees who meet the above criteria but where you have repaid to HMRC the grant amounts that you claimed in respect of those employees (because the Government determines that you do not need this financial incentive having weathered the initial COVID storm well). You will also be excluded where you made an incorrect CJRS claim (because the employee was not eligible).
How do I claim the CJRS bonus?
You will need to claim the bonus from HMRC online in the window between 15 February 2021 and 31 March 2021. The government guidance at will be updated in January 2021 with details as to how to make the claims.
Do I need to give some or all of the bonus to the employee who was furloughed?
You are not obliged to. This will be a commercial decision probably reflecting where your business is at by the time you receive the money.
How should I factor this into my business planning?
You only need to consider the Job Retention Bonus if you:
- did make use of the CJRS;
- did not repay all of the CJRS grant;
- you continued to employ, and still plan as at the end of January 2021 to employ, some or all of those in respect of whom you claimed under the CJRS; and
- will meet the minimum earnings threshold.
If you fall into this group, it is worth being aware of the ability to claim this bonus, doing some rough calculations as to the likely value and being aware of the relevant dates (31 January 2021 being the cut off for eligibility and 15 February 2021 being the window opening to claim).
The value of the bonus itself though is unlikely to be a significant factor to your long-term employment plans unless (a) you are in a sector where the Job Support Scheme will be useful (because you can see some sense in holding onto more employees perhaps on less hours or pay) and/or (b) you have a significant number of lower paid workers at or near the average lower earnings threshold of £520 per month (for whom the £1,000 bonus will equate to a substantial portion of the wages across the November to January period).
That said, it could still be a nice boost for those businesses who have managed through lockdown and could be utilised to thank staff who took a hit on their earnings. It might also encourage those businesses who hit crunch points in December 20 / January 21 to delay giving notice of redundancy and instead (in conjunction with the JSS) employ more people on fewer hours or less pay as an alternative to redundancies in the short-term as they continue to assess the evolving situation. However, given the numbers, this is only likely to work for those business where the impact of COVID is still not business critical, which is likely to be a decreasing number as the pandemic continues.