2nd November 2020

Coronavirus: lockdown prompts furlough scheme extension

Government announces one-month extension to the Coronavirus Job Retention Scheme to support businesses affected by the second national lockdown.

Government announces one-month extension to the Coronavirus Job Retention Scheme to support businesses affected by the second national lockdown.

On 31 October the Government announced that the Coronavirus Job Retention Scheme (CJRS) - otherwise known as the furlough scheme - has been extended for a month, due to the newly imposed national lockdown coming into force from Thursday 5 November. 

Employees will be able to receive 80% of their current salary (capped at £2,500) for hours not worked to be funded by the scheme. Under the extended scheme, the cost for employers of retaining workers will be reduced compared to the CJRS in recent months, where employers have had to top up wages by 10 % then 20%, with the funding reducing as the scheme wound down to a close. This means the now extended CJRS is more generous for employers than it was in October.

To be eligible under this extension, employees must be on an employer’s PAYE payroll by 23:59 on 30 October 2020. Businesses will have flexibility to bring furloughed employees back to work on a part-time basis or furlough them full time; they will only be asked to cover National Insurance and employer pension contributions which, for the average claim, accounts for just 5% of total employment costs.

The Job Support Scheme, which was scheduled to come in on Sunday 1 November, has been postponed until the extended CJRS (furlough) ends.

In addition, it was announced that business premises forced to close in England are to receive grants worth up to £3,000 per month under the Local Restrictions Support Grant.

Further details are expected to be released shortly. 

Please note: Nothing in this article constitutes legal advice and we are not liable for any reliance on the information provided. This is a rapidly changing subject, and whilst correct at the time of writing, circumstances may have changed since publication. Please refer to Gov.uk for up-to-date advice on the Government’s response to this issue.

To find out more about anything covered in this article, or to discuss the potential impact of COVID-19 on your business, please contact Kerrie Hunt or another member of Thrings’ Employment and Immigration team.


RELATED ARTICLES