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  • Second lockdown and the furlough scheme extension: everything you need to know

Second lockdown and the furlough scheme extension: everything you need to know

England is officially going under a second lockdown and the furlough scheme has been extended across the whole of the UK. Here’s what employers need to know now.

Monday, May 11, 2020
3 min read

Last Saturday 31st October, Boris Johnson announced that the government was placing England into a second national lockdown for one month, starting on Thursday 5th November and ending on Wednesday 2nd December 2020.

In this announcement he also stated that the government would extend the UK Job Retention Scheme (JRS), or ‘furlough scheme’—and this announcement came just hours before the scheme was due to end. Since then, Chancellor Rishi Sunak has confirmed the furlough scheme will be extended until the end of March 2021.

While it’s good news that the government is offering further financial support to businesses across the UK, it also means you have to wrap your head around more furlough processes.

But don’t worry, BrightHR has your back. Let’s start by looking at the lockdown rules…

The second lockdown restrictions

All of the lockdown restrictions are in place with one common goal—to reduce the amount of social contact and reduce the spread of coronavirus. To achieve this goal, the lockdown rules essentially say that everybody in England must stay at home and not meet anyone from a different household.

There are exceptions to the rule, as set out by the government, such as people needing to get food or medicine, or go to work in certain situations or industries. But in general, the lockdown rules mean that lots businesses will close their premises and their staff will work from home where it is reasonably possible for them to do so.

Of course, there are certain businesses and industries where working from home is not possible, such as the hospitality industry. And if this is you—then you’ll likely need to put your staff on furlough.

The furlough scheme extension—what’s new?

The furlough scheme extension is currently more generous for employers. While employers have had to contribute a little more to employees’ wages in the last couple of months, the extension sees employers only paying the furloughed employee’s National Insurance and Pension contributions.

However, the government will review this again in January to determine if employers should be asked to contribute more.

Here’s exactly how the furlough scheme extension works:

  • Employers that have to close their business or can’t operate as normal because of lockdown can claim full furlough for their staff.
  • Full furlough grants will cover 80% of staff pay, up to a maximum of £2,500 per person, per month (and employers pay National Insurance and pension contributions).
  • Employers can also choose to claim flexible furlough grants. This means you can bring staff back part-time and claim furlough grants for the hours they’re not working.
  • Employers do not need to have previously furloughed staff to claim under this extended scheme and can put people on furlough for the first time (subject to eligibility).

What if I’ve already made staff redundant?

With the furlough scheme originally due to end on 31st October 2020, you might have already made some of your staff redundant—but wouldn’t have done so if you’d known the JSS scheme would be extended until March 2021.

If this is you, there is something you can do. Because part of the revised furlough scheme allows for anyone made redundant after 23 September 2020 to be rehired and put back on furlough.

How do I put staff on furlough now?

The furlough scheme extension is good news for employers, but you have to do some work in order to get the benefits. To put an employee on furlough, you need to:

  1. Get formal agreement from employees that they will be furloughed.
  2. Submit accurate details to HMRC in order to claim your employees’ wages.
  3. Communicate all important information to your furloughed staff with official correspondence.
  4. Keep records of this correspondence for five years in-line with HMRC laws.

BrightHR’s furlough navigator tool

Getting furlough claims wrong could land you in hot water with HMRC, but our furlough navigator tool helps you get it right.

Use it to record all furloughed employees’ details in one place, access accurate information to make HMRC claims easy, discover a library of useful guides and letter templates, and store all documents securely with unlimited storage.

Navigating your business through the coronavirus pandemic can be challenging, but BrightHR makes putting staff on furlough as simple, straightforward and stress-free as possible. To find out more about the furlough navigator tool and how it can help your business, book your free demo today.

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