The CJRS (Coronavirus Job Retention Scheme) or Furlough scheme changes from 1 July 2021. It begins winding down to its closure on 30 September, despite the four-week delay in easing COVID-19 restrictions originally expected on 21 June 2021. The Chancellor Rishi Sunak, has to date rejected pleas to maintain emergency economic support in line with public health restrictions. This means that some businesses will have to begin payment contributions to the CJRS from 1 July when their trading continues to be restricted by the delay to the easing of lockdown measures.
To recap the changes, from 1 July 2021, employers will be asked to contribute towards the cost of furloughed employees wages. To be eligible for the grant employers must continue to pay their furloughed employees 80% of their wages up to a cap of £2,500 per month for the time they spend on furlough. Wage caps are proportional to the hours not worked. Employers may choose to top up wages above 80% total and £2,500 cap for hours not worked, at their own expense.
- the government contribution to the wages for hours not worked will be 70% up to a cap of £2,187
- employers will be required to pay employer National Insurance Contributions (NICs)and pension contributions
- employers will need to pay 10% of the wages for hours not worked, up to a cap of £312.50
- employees must receive 80% of their wages for hours not worked, up to a cap of £2,500 per month
From 1 August 2021 until 30 September 2021:
- the government contribution to the wages for hours not worked will be 60% up to a cap of £1,875 per month
- employers will be required to pay employer National Insurance Contributions (NICs)and pension contributions
- employers will need to pay 20% of the wages for hours not worked, up to a cap of £625 per month
- employees must receive 80% of their wages for hours not worked, up to a cap of £2,500 per month
If you need our help in navigating the changes or projecting your cashflow position, please do get in touch.