Update to the furlough scheme

From 1 July employers will need to start contributing towards the pay that any of their furloughed employees receive.

Under the Coronavirus Job Retention Scheme (aka furlough scheme) employees who are not working all their normal hours are entitled to 80% of their salary (capped at £2,500 per month) for hours not worked, due to the pandemic.

Up until 30 June, the 80% payment will be fully-funded by the government, with employers having to pay National Insurance (NI) and pension contributions. But from 1 July, the government contribution will reduce to 70%, meaning that employers will have to fund 10% (up to £312.50 per month), ensuring that furloughed employees still receive 80% salary for any hours not worked.

For the last two months of the furlough scheme, August and September, the government contribution will reduce to 60%, with employers required to top-up the 20% difference (capped at £625 per month) for any hours not worked, in addition to NI and pension contributions.

When the Chancellor, Rishi Sunak announced the latest extension to the furlough scheme as part of the Budget in March, he confirmed that the scheme would close on 30 September.

Here you can find our helpful summary of the changes to the scheme and the deadlines for submitting your monthly furlough claims

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