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All you need to know about the end of the Coronavirus Job Retention Scheme (CJRS).

The government’s lifeline for business and employees was launched in March at the start of the pandemic and lockdown period and is now due to come to an end in October.

While around ten million people were furloughed, and many have returned to work, some do remain on furlough, having their income supported by the CJRS.

However, there are some key dates approaching which may impact you or your employees.

Key Dates

1 October – The scheme will change so that the government will reimburse 60% of wages, capped at £1875 per month, for the hours the employee does not work. Employers must pay 20% towards the salary to ensure employees still receive 80% of their salary up to a cap of £2500, plus employers’ National Insurance and pension contributions.

31 October – The scheme officially ends

1 November – the CJRS is being replaced with The Job Support Scheme; this scheme will run until April 2021.

Alternative Support

The Chancellor Rishi Sunak previously ruled out extending CJRS but trade unions were worried about job losses escalating when the scheme comes to an end in October. In response to this the Job Support Scheme has been announced however we are awaiting further detailed guidance on how the scheme will be administered. The government is however offering employers some other incentives at that point:

• Employers will receive a one-off payment of £1,000 for every employee who has previously been furloughed under CJRS so long as they remain continuously employed to the end of January 2021. To ensure the jobs are meaningful and well-paid, employees must earn at least £520 per month on average between the beginning of November 2020 and the end of January 2021.

• The Kickstart Scheme is available for new 6-month job placement’s for young people who are currently on Universal credit and at risk of long-term unemployment, however funding applications must be for a minimum of 30 job placements. Employers can partner with other organisations in order to meet the minimum requirement.

• Incentives for hiring a new apprentice could see employers receive £2,000 for every under-25 apprentice who started their contract of employment between 1 August 2020 and 31 January 2021, or £1,500 for over 25s

What happens next?

While we await further guidance on the Job Support Scheme we would recommend identifying those employees on your payroll who will not be able to work their full usual hours once the CJRS ends from 31 October 2020. This will allow us to calculate the costs involved to the business should you choose to use the Job support Scheme.

Alison Welton, Managing Partner at David Allen said of the scheme: “The CJRS has been a much-needed lifeline for employers and employees who have been impacted by the Coronavirus lockdown and ongoing social distancing measures.

“We have been working closely with our clients to support them with understanding and implementing the scheme and also securing additional grants and loans which have been introduced to support businesses at such a difficult time.

“My advice to businesses who are still struggling and are concerned about the end of the scheme is to speak to our team here at David Allen to see how we can advise and support you through the changes and the ever evolving legislation.”

Please contact us to find out more.