Covid-19 – Employment Law update – 2 June 2020

Changes to the CJRS including part time working

On Friday 29 May, the Chancellor announced a series of changes to the Furlough scheme over the coming months. Only limited information is available until the detailed guidance is published on 12 June, but we have summarised what we know so far below:

  • The current scheme closes on 30 June 2020 and employees must have completed a three week furlough period prior to this date in order to be eligible for the new scheme.  From 1 July 2020 employers can only claim from the CJRS in respect of employees who were furloughed on or before 10 June 2020.
  • From 1 July, furloughed employees will be able to do some part time work for their employer provided the employer pays their wages while they are working.
  • From 1 August, employers will have to pay Employer NI and any employer pension contributions for furloughed employees.
  • From 1 September, the Government will pay 70% of wages up to a cap of £2,187.50.  Employers will pay Employer NI and pension contributions and 10% of wages to make up the 80% total, up to the cap of £2,500.
  • From 1 October, the Government will pay 60% of wages up to a cap of £1,875.  Employers will pay employer NI and pension contributions and 20% of wages to make up the 80% total, up to the cap of £2,500.
  • The scheme will close on 31 October.

Employers will be able to bring furloughed employees back to work part time from 1 July. You can agree any working pattern you want but employers will have to pay their employees’ normal salary and benefits for any time they work. For the rest of their contractual hours, employers will be able to claim furlough payments at the existing level. The amount you can reclaim through the scheme will change over the next few months as set out above.

Should you require any assistance with your employment arrangements during this difficult period, do not hesitate to contact the co-head partners of our employment department.  Ewan Keen can be reached on 020 3206 2724 or Tamara Ludlow on 020 3206 2739.