The UK’s Job Retention Scheme

On 20 March 2020 the UK government announced its Job Retention Scheme (JRS). The JRS allows businesses to place employees on furlough (temporary leave of absence) and reclaim 80% of their usual monthly wage costs from HMRC, subject to a cap of £2,500 per month. It has been possible to submit claims since 20 April 2020.

The Chancellor of the Exchequer announced on 12 May 2020 that the JRS will remain in place until the end of October 2020 and further details of the extension were published on 29 May 2020. The JRS will continue largely in its current form until the end of July and then in a modified form for a further three months. However, the JRS will close to new entrants on 30 June, with staff who have not previously been furloughed having to be placed on furlough by 10 June 2020 in order to qualify.

Further details of the modified JRS are set out below, but the key points are that employers will have to make a contribution to workers' wage costs from September and will not be able to reclaim employer NICs or mandatory employer auto-enrolment pension contributions after July. Furloughed staff will be able to carry out work on a part-time basis from 1 July 2020, but employers will be responsible for paying staff for hours worked. More detailed guidance is expected in due course and we will update this note when that guidance is available.

Read more: The UK’s Job Retention Scheme

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