May 12, 2020

There has just been a very significant announcement relating to the Government’s Coronavirus Job Retention Scheme which we wanted to ensure you were aware of as soon as possible.

The headline is that the Chancellor, Rishi Sunak, has announced that the scheme will be extended for four months, until the end of October 2020. The scheme will apply as it currently does until the end of July (i.e. for a further month) but will then be adjusted from the start of August to the end of October 2020.

It is not clear precisely what changes will be made for this later period but a series of tweets from the Chancellor state that the scheme will continue to apply to all sectors and parts of the UK during this time but will have greater flexibility to support the transition back to work. In particular, this will allow furloughed employees to be brought back to work part-time. This will be on the basis that employers are asked to pay a percentage towards the wages of their furloughed staff but will ensure that those eligible continue to receive 80% of their pay (up to the usual £2,500 monthly cap). Full details will be published by the end of May and the official announcement can be seen here which includes some interesting statistics regarding take up of the scheme to date.

Given the considerable interest from our clients in utilising the scheme, this is likely very encouraging news. It should also be especially helpful for those who are still considering whether to re-engage and furlough staff given recent concerns as to whether backdated claims are possible. In those circumstances, the additional period that the scheme will now run for will help increase the support available to those where backdating isn’t possible.

We will of course be keeping an eye on further developments and will provide a further detailed briefing once the additional details are published by the Government later this month.