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Furlough scheme extension: What do you need to know?

Despite remaining resolute that the coronavirus job support scheme, commonly known as the furlough scheme, would end on the 31st October 2020, it was announced that, along with a second lockdown the scheme would continue.

This means that the level of support employers have received previously and during the first lockdown will continue with employers claiming 80% of wages for furloughed hours.

In this episode of the podcast I cover the key points to note at this time (01/11/20):

  • Any business can use the scheme.
  • Employers must pay 80% of wages for time not worked, i.e. when the employee is furloughed.
  • There is no additional contribution required, the government will pay the full 80% that you must pay to furloughed employees, up to a cap of £2,500.
  • Employers are required to pay National Insurance and Pension Contributions.
  • Flexible-furlough is available, meaning employees can work some of their normal hours and Employers can make a claim for 80% of pay for the remaining time not worked.
  • Neither employer nor employee needs to have previously used the scheme in order to use it now.
  • Employees must have been on the employers’ PAYE payroll by 23:59 on 30th October 2020. Meaning an RTI submission must have been made for them on or before the 30th October 2020.
  • Calculations for pay and hours will broadly follow the same method as previously used under the scheme.
  • Minimum report period of 7 consecutive calendar days.
  • Employers need to keep a record of the hours worked and usual hours they would be expected to work in a claim period.
  • Employers can top up wages if they wish.
  • There will be no gap in eligibility for support between end of the old scheme and this new extension scheme.

Action to take

Employers who want to use the scheme must write to staff to seek agreement for a continued period of furlough.

Many employers will have already written to employees to tell them that the furlough scheme was ending, and their period of furlough or flexible furlough would be coming to an end. You will therefore need to enter into a new agreement with them for the new period of furlough extension.

We have produced a Free Template Letter which you can use – download your free copy HERE.

As always if you have any questions or you need specific advice please contact us directly on 01983 897003 or by email to:

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As part of our HR Harbour annual subscription service for employers we provide guidance and training for employers, supervisors and managers. If you would like to know more about the HR Harbour Service and how you can get unlimited support from as little as £198 per month please contact me for a no obligation discussion – or you can find full details here: HR Harbour

Don’t forget you can contact us by telephone 01983 897003, 01722 653001 or 023 8098 2006

The information contained in this Podcast and post is provided for guidance and is a snapshot of the law at the time. It is provided for your information only and should not be used as a substitute for obtaining legal advice that it specific to your particular circumstances.

The guidance should not be relied upon in any decision making process. It is strongly recommended that you seek advice before taking action.

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