As we head towards July, it is worth noting that the Government funded Coronavirus Job Retention Scheme (Furlough) is about to be reduced, despite current ‘restrictions’ remaining in place until 19th July 2021. We review the current scheme and provide an Furlough Scheme update for employers.
Furlough Scheme Update
Although the scheme will continue to run until the end of September, in addition to covering National Insurance and employer pension contributions from 1st July employers will also be expected to make a 10% contribution towards any unworked hours funded under the scheme. This will rise to 20% in August and September.
Furloughed employees will still receive 80% of their salary (subject to the £2500 per month cap) during this period.
Flexible furlough will remain an option for employers who are still struggling to fully open or trade due to the effects of the pandemic on their business.
As has been the case since November 2020, employers are expected to pay notice periods in full for any employees leaving the business. The scheme will not allow employers to recoup the cost of any employees notice period, whatever the reason and regardless of whether an employee is furloughed from work during this period of time.
As it stands, the scheme will conclude on 30th September 2021. In readiness for this, we urge employers to start making longer term plans. Hopefully employers will be able to support their employees in their return to their contracted hours. If not, consideration needs to be given to whether alternative or reduced ways of working will be required, whether there will need to be a further period of lay off or short time working or whether as a last resort, employers need to consider a longer term solution such as redundancies.
Wirehouse clients should contact the HR Advice Line and speak to our advisers who will help navigate you through the coming months, whatever position you find yourselves in. If you are not a Wirehouse client and need advice and support managing any HR issues please contact our team of Employment Law Consultants.
Article written by Becky Edwards – Wirehouse Employment Law Consultant