The Job Retention Scheme Extension

4th November 2020

10 Things to Know About the Job Retention Scheme Extension

If both you as an employer and your staff are feeling confused at present it’s little wonder! It’s getting rather hard to keep up – we’re on shifting sands and no mistake. First we anticipated the introduction of the Job Support Scheme and expected the end of the Job Retention Scheme. But it’s all changed again. Now there’s a last minute reprieve. This reprieve has seen the job retention scheme extended. In the fist instance the intention of this change was to cover November, but now we have it through to March 2021.

So, in the light of all that the following points are worth clarifying:

1. Employees on furlough agreements until the end of October can now remain on those agreements.

2. The Job Support Scheme and the Job Retention Bonus have been shelved for the time being

3. Neither the employer nor the employee needs to have used the job retention scheme before.

4. The extension enables employers to furlough employees who started after 20th March for the first time.

5. In other words, the scheme is available in respect of employees who were on the employer’s PAYE on 30 October 2020. More specifically, you must have made an HMRC payroll submission containing the relevant employee(s) by 30th October.

6. For new employees you must base the reference pay and usual hours on the last pay period before 30th October 2020. Or, for those on variable hours, their average earnings for the period between 6th April (or when their employment started, if later) and 30 October 2020.

7. For employees already on the scheme the pay calculation remains as before.

8. Employers can claim for the hours that their employees are not working. You can calculate this by reference to their usual hours worked in a claim period.

9. When claiming, employers need to report and claim for a minimum period of seven consecutive calendar days.

10. For hours not worked by the employee, the government will pay 80% of wages up to a cap of £2,500 per month for November & December 2020 and January 2021. The government intend to review this in January. It will assess whether economic circumstances are improving enough to ask employers to contribute more.

graphic of figure running to word JOB with a clock in the middle

Also:

Employers will pay employer NICs and pension contributions for the hours not worked.
Employees get paid as normal for hours worked.
Employers can still choose to top up employee wages beyond the monthly cap at their own expense if they wish.
It’s possible to make claims from Wednesday 11th November 2020 UP TO the 14th day of the following month.

Go-Legal HR are here to help

If you need any support with aspects relating to the Job Retention Scheme and furlough leave agreements Go Legal HR can help. It can be difficult to get your head around all the complexities. Don’t struggle! Get in touch now.

There are three ways to get in touch with Go-Legal: