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Last updated: 3 Mar 2021

Spring Budget 2021: Coronavirus Job Retention Scheme further extended until 30 September 2021

The Coronavirus Job Retention Scheme (CJRS), which has protected more than 11 million jobs since March 2020, was due to close at the end of April 2021, has now been extended until 30 September 2021.

What are the updates to the CJRS?

Today, as part of the Spring Budget, the Chancellor announced that this has been extended for a fourth time, until 30 September 2021, providing continued support to those businesses and charities that have had to close their doors as a result of the pandemic. As it currently stands, the extended furlough scheme will support organisations in a similar way to the previous scheme, with the government paying 80% of the gross ‘wage costs’ for each eligible worker up to a maximum of £2,500 per month for the hours not worked. Employers will continue to be required to pay National Insurance Contributions and pension auto- enrolment contributions of furloughed employees. Flexible furlough, as well as full time furlough will continue to be allowed.

The key change in the extension of the CJRS is that from July, the government contribution will drop by 10% to a maximum of 70% and employers will have to pay 10% towards hours their staff do not work. In August and September, as the economy reopens, the government will pay 60% with employers contributing 20% towards the hours their staff do not work. The scheme will then end on 30 September 2021.

About the author

Sarah Dalton

daltons@buzzacott.co.uk

What should employers do now?

As a result of this extension, there are some simple steps all employers should take in order to ensure their organisation maximises the benefits of the scheme:

Review the implications on your business of the extension to furlough. For example, can you re-open ahead of schedule or retain members of staff for longer than anticipated?
Keep channels of communication as open as possible with your employees during this unsettling time, as the health and wellbeing of your employees will be your first concern. A simple note mentioning that you’re reviewing the implications of the extension and what it means could go a long way to provide nervous employees reassurance at this time.
Identify those employees who are to be furloughed and obtain their written agreement to the extension. For those employees for whom redundancy consultation has commenced, consider whether, with an employee’s agreement, redundancy proceedings can be deferred and an employee placed on furlough instead. As this is a complex area, we advise you seek professional advice before proceeding.
When bringing employees back to work either on a part-time or full-time basis, identify which employees you wish to return and your reasoning behind this decision. Consultation should also take place with written confirmation.

These are just some of the issues employers need to consider as a result of the challenges that have arisen from COVID-19.

The Buzzacott HR Consultancy team provide commercially focused HR advice and guidance, making our clients aware of any potential risks that might be associated with the matter in hand. If needed, we can also be on hand to prepare the required documentation and be present during meetings.

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Have an enquiry about what the Budget means for you?

If you have any HR queries resulting from the Budget or any other matter in your organisation, please get in touch.