UK Furlough scheme extended by four months

On the afternoon of Tuesday 12 May, it was announced that the Coronavirus Job Retention Scheme is to be extended unchanged for four months, to the end of October 2020. https://www.gov.uk/government/news/chancellor-extends-furlough-scheme-until-octoberThe scheme will continue with greater flexibility from August to October to support employees’ transition back to work. Specifically, from August, employers currently using the scheme will be able to bring furloughed employees back part-time so from then they are dropping the strict rule that furloughed workers must not perform any work for their employer.

Rishi Sunak said “We will ask employers to start sharing with the government the cost of paying salaries.”  The Treasury commented “The employer payments will substitute the contribution the government is currently making, ensuring that staff continue to receive 80% of their salary, up to £2,500 a month.”

We assume that this is to facilitate employees returning to work part-time with some continued financial support from the government but probably on a lower basis.Further details are due to be published by the end of May and we will provide further updates when we know more. Mercer & Hole’s Covid-19 Business Support Hub primary focus is to update clients on all the latest developments and support measures available.

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