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05 November, 2020

Emma Swan
Partner and Head of Commercial Employment

Just as we began to get our heads around the postponement of the Job Support Scheme (JSS) and the extension of the original Coronavirus Job Retention Scheme (CJRS) otherwise known as the "furlough scheme", Rishi Sunak has announced that the CJRS will now be extended until March 2021.

What we know so far:

  • Flexible furlough will continue.
  • The Government will cover 80% of normal wage costs for hours that are not worked up to a maximum of £2,500 per month.
  • Employers will cover National Insurance and Pension contributions only.
  • The CJRS will be reviewed in January in line with the position of the economy.
  • The Employer contribution may increase if the economic circumstances allow for this, following the review in the new year.
  • The Job Retention Bonus will no longer exist but may be revisited later.

Our views:

Whilst this comes as fantastic news for many businesses across the UK, it may not necessarily come as welcomed news to those that have been made redundant over the last few months, in anticipation of the CJRS ending originally on 31 October 2020.

Despite the announcement of the JSS to supersede the CJRS, since the terms of the scheme were less favorable and the purpose of the scheme was only to protect "viable jobs" - unfortunately, this did not alleviate the number redundancies that have already been made as a result.

While it is still unclear whether the extension of the CJRS is intended to protect "viable jobs" or just to delay redundancies being made too soon, it is clear that this will support many businesses across the UK over the winter, whether they are in the worst hit sectors and forced to close, or have suffered a steep decline in work.

It is possible (depending on the forever changing/evolving rules of the CJRS) that employers could consider putting employees who were on the payroll on 23 September 2020 and who have since been made redundant, back on furlough.

However, in doing so, employers will need to consider the circumstances carefully as they would be re-employing the individuals and ensure that decisions are taken with the impact of the pandemic on businesses in mind, but also within the parameters of Employment Law. We would strongly advise seeking legal advice on your strategic business plans and use of the CJRS going forwards.

For more information contact Emma Swan in our Employment & HR department via email or phone on 01254 222354. Alternatively send any question through to Forbes Solicitors via our online Contact Form.

Learn more about our Employment & HR department here

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