Mounting pressure on Government has resulted in a further extension to the Furlough Scheme
Under mounting pressure from businesses and opposition parties, Chancellor Rishi Sunak, announced on 5 November 2020 that the government’s Coronavirus Job Retention Scheme (CJRS) would remain open until 31 March 2021. While it would have been helpful for this to have been announced at the same time as the national semi-lockdown, this has been a welcome reprieve for those that work in the hospitality and entertainment industries and those most affected by local and national lockdowns.
Employees will receive 80% of their current salary for hours not worked, up to a maximum of £2,500 per month which is more generous than the scheme run in September and October. But this percentage is likely to be reviewed for February and March 2021.
Employers can claim even if they or relevant employees had not previously used this furlough scheme as long as they were on the payroll on 30 October 2020. It continues to be a flexible scheme where employees can continue to do some work. In addition, employees can be furloughed if they are shielding.
Employees who were made redundant or stopped working for their employer on or after 23 September 2020 can be re-employed and put on furlough.
However, the government is reviewing whether employers should be eligible to claim for employees serving contractual or statutory notice periods and are likely to change the rules for claim periods starting on or after 1 December 2020, with further guidance coming out in late November.
The Job Support Scheme and the Job Retention Bonus have now been put on hold and may be introduced at the end of the CJRS despite criticisms that they did not go far enough to support workers and businesses.
It is expected that the same furlough scheme will be used for the self-employed, as has been the case previously.
The extended Furlough Guidance was only published on 10 November 2020 and within less than 48 hours it had to be amended due to discrepancies about the new TUPE rules.
This late U-turn and extension to the furlough scheme has led to concerns that this semi-lockdown is likely to last well into spring as action had to be taken to ensure people’s livelihoods. More importantly, this late reaction highlights that this government has no strategy for dealing with this pandemic, let alone a cohesive strategy for economic recovery when the UK is able to come out of lockdown.