The furlough scheme is changing, again. Many businesses and charities have relied on the lifeline that the regularly changed and updated furlough scheme has offered.
Although the plan was to phase the scheme out in the autumn following the renewed restrictions in the winter and spring has been extended with the latest plan (as at 18th June 2021) being to start phasing it out in July.
For periods ending on or before 30 June 2021 where staff are furloughed businesses and charities have been able to claim 80% of an employee’s usual salary for hours not worked, up to a maximum of £2,500 per month. They are responsible for pension and national insurance contributions, but it has been a major help for businesses either formally closed or substantially affected by the pandemic.
Some employers have already chosen to top this up to 100% of usual salary, but in any case there is a requirement to pay your employee at least 80% of their usual wages for the hours that they’re furloughed and not working, which is currently the amount you can claim through the scheme
From 1 July 2021, the level of grant will be reduced each month and you’ll be rquired to top up to at least 80%. Make sure you’re clear about waht this means for your business and staff.
We have found that many organisations have been using the ability to ‘part furlough’ that was created after lobbying from many smaller businesses and charities and we expect this to continue with the new approach.
As there have been many last minute changes to the rules in the past, do make sure that you keep checking the news – we could well be posting before long that the furlough scheme is changing again.
For regular updates as more information comes available, make sure you get our free monthly newsletter – we have one focused on small business and the other is aimed at those involved in charities..