On May 12 the Coronavirus Job Retention Scheme (JRS) was extended by Chancellor Rishi Sunak to extend the scheme for four months until the end of October.
Currently the Government pays 80 per cent of people’s wages, covering 7.5 million jobs in the UK which will continue throughout June and July. From August, company’s will be asked to pay national insurance and employer pension contributions.
Sunak announced that from September, the government will pay 70% of the furlough wage, and employers will pay the remaining 10%. Then before the scheme finishes at the end of October, the portion paid by the employer will rise to 20%.
As the scheme eases, businesses will strategically begin to bring employees back to work. From 1 July, businesses will be permitted to bring workers back part-time and claim the remaining unworked hours from the scheme. This flexibility requires careful skill gap planning to ensure that those brought back into the workforce are fulfilling current business demand that will bring the company back to productivity.
Analysing key skill sets and producing a skills matrix will help identify the necessary requirements of teams and the overall company. It is important to maximise the skills of employees and their performance to help the business achieve productivity throughout the coming months.
Phasing employees back into a positive working routine will require careful leadership to ensure that workers are motivated and engaged with managers. Maintaining communication and creating clear expectations will help reintroduce workers back into the team.
• 10 June: This will be the last day employers can place employees on furlough.
• June-July: Employers can continue to claim up at the current levels
• 1 July: ‘Flexible Furlough’ will be introduced; employers can bring back employees that have previously been furloughed for part-time hours and claim the remaining salary from the scheme. More details announced June 12.
• 1 August: The Government grant will be slowly tapered. Employers will now be required to pay Employer NICs and pension contributions for the unworked hours.
• 1 September: The Government will pay 70% of wages up to a cap of £2,187.50 for the hours the employee does not work. Employers will be asked to pay Employer NICs, pension contributions, and 10% of wages to make up a total furlough payment of 80%.
• 1 October: The Government will pay 60% of wages up to a cap of £1,875 for the hours the employee does not work. Employers will be asked to pay the remaining 20% to make up a total furlough payment of 80% alongside Employer NICs and pension contributions.
• 31 October: The Government scheme will end.