On the 1st November it was announced that England would go into a second national lockdown. Alongside the announcement the government have changed their support packages for UK businesses and workers.
Coronavirus Job Retention Scheme- Update 5th November 2020
The Coronavirus Job Retention (furlough) Scheme will remain open until 31st March 2021, with the previously announced Job Support Scheme postponed until furlough scheme ends.
Which employers can claim under the new Coronavirus Job Retention Scheme from November 2020?
The government is extending the CJRS to support individuals and businesses who are impacted by disruption caused by coronavirus (COVID-19) this winter. This is an extension of the CJRS and the scheme rules will remain the same except where HMRC say otherwise.
The existing criteria stated that eligibility was based on:
“If you cannot maintain your workforce because your operations have been affected by coronavirus (COVID-19), you can furlough employees and apply for a grant to cover a portion of their usual monthly wage costs where you record them as being on furlough.”
Your employees can also be furloughed if they are unable to work because they:
- Are shielding in line with public health guidance (or need to stay at home with someone who is shielding)
- Have caring responsibilities resulting from coronavirus, including employees that need to look after children.
How much grant is available?
For claim periods running to January 2021, employees will receive 80% of their usual salary for hours not worked, up to a maximum of £2,500 per month. The £2,500 cap is proportional to the hours not worked. The government will review the policy in January 2021 to consider whether employers should pay more at this stage. The grant must be paid to the employee in full.
As under the current CJRS, flexible furloughing will be allowed in addition to full-time furloughing.
What are employer’s eligibility requirements?
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. Employers across the UK can claim, whether their businesses are open or closed.
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 previous CJRS eligibility requirements also apply to these employers. Full details will be included in guidance which will be published on 10 November 2020.
What are employee’s core eligibility requirements?
Employers can claim for employees who were employed and on their PAYE payroll on 30 October 2020. The employer must have made a PAYE Real Time Information (RTI) submission to HMRC between the 20 March 2020 and 30 October 2020, notifying a payment of earnings for that employee.
Employers will have flexibility to use the scheme for employees for any amount of time or shift pattern, furloughing employees on either a full-time or part-time basis, and will be able to vary the hours worked in agreement with the employee.
As under the current CJRS rules, employees can be on any type of employment contract.
What are the basis for calculations for periods starting on or after 1st November 2020?
All employees on an RTI submission on or before 19 March 2020 will be able to use the CJRS calculations as applied in August 2020 for reference pay and usual hours.
However, for new employers claiming and new employees hired between 20 March 2020 and 30 October 2020 the CJRS methodology will update the reference pay and usual hours to take account of the period covered by the extension.
For employees on fixed pay employed on or after 20 March 2020, the last pay period prior to 30 October 2020 provides the basis for calculation. For employees on variable pay or hours, employed after 20 March, the average of tax year 2020 to 2021 up to the start of the furlough provides the basis for calculation. Full details of the calculation will be shared in guidance on 10 November 2020.
When can employers claim under the CJRS extension?
The employers must report and claim for a minimum period of 7 consecutive calendar days.
The claim period must start and end within the same calendar month. An employer can make a claim in anticipation of an imminent payroll run, at the point they run their payroll or after they have run their payroll.
Employers will be able to claim from 8am on Wednesday 11 November 2020. Claims can be made:
- in respect of an employee for a minimum 7 day claim window
- in advance
- in arrears for the period from 1 November 2020 to 11 November 2020, from the week commencing 9 November 2020
Claims relating to November 2020 must be made by 14 December 2020. Claims relating to each subsequent month should be submitted by day 14 of the following month, to ensure prompt claims following the end of the month which is the subject of the claim. Grants payments are anticipated 6 working days after the first claims.
Full guidance will include further detail on how to claim and will be published on 10 November 2020.
Will companies still be able to claim the Job Retention Bonus in February 2021?
The government have advised that the Job Retention Bonus (JRB) will not be paid in February 2021 and a retention incentive will be deployed at the appropriate time.
Mortgage payment holidays will no longer end on 31st October 2020- borrowers who have been impacted by coronavirus and have not yet had a mortgage payment holiday will be entitled to a six month holiday, and those that have already started a mortgage payment holiday will be able to top up to six months without this being recorded on their credit file.
The FCA will announce further information soon.
Businesses required to close in England due to local or national restrictions will be eligible for the following:
- For properties with a rateable value of £15k or under, grants to be £1,334 per month, or £667 per two weeks;
- For properties with a rateable value of between £15k-£51k grants to be £2,000 per month, or £1,000 per two weeks;
- For properties with a rateable value of £51k or over grants to be £3,000 per month, or £1,500 per two weeks.