Furlough scheme update and new rules
Published Mar 26, 2021
In February’s budget the Chancellor confirmed that the Coronavirus Job Retention Scheme has been extended until the end of September although employers will be required to contribute from July onwards.
July 2021
The Government contribution will drop from 80% to 70% of salary up to £2,187.50. Employers are expected to pay a 10% contribution to maintain employee salaries at 80%.
August and September 2021
The Government contribution will drop further to 60% of salary up to £1,875. Employers are expected to pay a 20% contribution to maintain employee salaries at 80%.
Employers will also continue to pay all employees’ national insurance and pension contributions.
As we approach these changes, organisations need to review the situation of workers currently on furlough and plan if redundancies or restructures are required. For employees who will be returning it is also important to plan their reintegration from furloughed back into work.
Other notable features from the budget include:
- Increase in incentive payments for businesses to hire new apprentices. These payments are rising to £3,000 for each new apprentice hired, regardless of age.
- New grants under the Restart Scheme of up to £18,000 will be available to businesses in hospitality, accommodation, leisure, personal care and gym sectors.
- A new ‘Help to Grow’ scheme providing around 130,000 SMEs with access to management training, technology advice and discounted software.
Source: Gavin Parrott