10 KEY POINTS TO NOTE

If your business leaders are asking you for the detail of the Extended CJRS, here is what we know so far:

1. Extended CJRS. The Coronavirus Job Retention Scheme (CJRS) was due to end on 31 October 2020 and, from 1 November 2020, was going to be replaced by the Job Support Scheme Open (JSSO), for businesses remaining open but experiencing reduced business activity, and the Job Support Scheme Closed (JSSC), for businesses forced to close. However, there was a last minute U-turn on the evening of 31 October 2020 when the government announced that the CJRS will not now end on 31 October 2020 but, instead, will be extended and will run through until 2 December 2020. The JSSO and JSSC will be postponed and will start on 2 December 2020 when the CJRS extension ends.
2. Terms of extended CJRS. It is described as an extension to the CJRS but, in actual fact, it is not being extended on the terms that were in place on 30 October 2020 but, instead, is being “extended” on the terms that were in place in August 2020; that is, the government will fund up to 80% of a furloughed employee’s current salary for hours not worked (calculated by reference to their usual hours worked in a claim period), up to a maximum of £2,500 per month. Employers are only being asked to cover NICs and employer pension contributions for the hours the employee does not work. As before, the grant must be paid to the employee in full.
3. Full and flexible furlough. In addition to full furlough, flexible furlough is still available if employers want to take employees off full furlough and bring them back to work on a part-time basis (or move them from full-time work to part-time furlough). In such cases, employers should continue to pay the employee for hours worked in the usual way (and employers are also responsible for paying tax and NICs on those amounts as normal).
4. Top ups. As with the initial CJRS, employers can top up employee wages above the CJRS grant at their own expense if they wish.
5. Employer requirements. To be eligible, employers must have a UK bank account and a UK PAYE scheme. However, this time around, employers do not need to have previously used the CJRS. The government expects that publicly funded organisations will not use the scheme.
6. Employee requirements. Employees will be eligible if they were on the employer’s payroll as of 23:59 on 30 October 2020 (and a RTI submission must have been made by that time too). There are no rules about having already been furloughed to be eligible. This is welcome news as it will catch new starters and those that hadn’t previously been on furlough for the required 3 weeks between 1 March and 30 June 2020 (previously required when flexible furlough came in). Under the CJRS extended scheme, employees must be furloughed for a minimum of 7 consecutive days. As before, employees can be on any kind of contract.
7. Calculations. They will broadly follow the same methodology as currently under the CJRS. Employers will need to report hours worked and the usual hours an employee would be expected to work in a claim period.
8. Written agreement. For those employees who are not currently on furlough, they will need to be given a written agreement recording the arrangement. For those currently on furlough, an extension to any current agreement will be required.
9. Timing. Whilst the UK’s second lockdown is not due to commence until Thursday 5 November 2020, the government has confirmed that there will be no gap in eligibility for support between the previously announced end-date of CJRS and this extension. The government will shortly confirm when claims can first be made in respect of employee wage costs during November. It is envisaged that, at first, employers will need to pay the costs out and then will be reimbursed but when the government has adjusted its system, the grant will then be paid upfront.
10. Further details. Further details, including how to claim this extended support through an updated claims services, are due to follow.

The law is constantly changing and the position set out in this note may not be current. You should not rely on this note as a comprehensive statement of the law. Please contact the Knights plc Employment Team if you require specific legal advice on your situation. © Knights plc 1 November 2020