• Coronavirus Job Retention Scheme will continue until end of October
• furloughed workers across UK will continue to receive 80% of their current salary, up to £2,500
• new flexibility will be introduced from August to get employees back to work and boost economy
Rishi Sunak, Chancellor of the Exchequer, announced yesterday, Tuesday 12th May, that the Coronavirus Job Retention Scheme will be extended until the end of October. He confirmed that furloughed workers could continue to receive 80% of their current salary (up to £2,500).
This news will come as a relief to many businesses whose staff are unable to go back to work under the prevailing conditions. The Chancellor also announced that, from the start of August, there will be a higher degree of flexibility, to allow companies to return staff on a part-time basis if necessary. These employers would be asked to pay a percentage towards the salaries of their furloughed staff. The employer payments will substitute the contribution the government is currently making, ensuring that staff continue to receive 80% of their salary, up to £2,500 a month. There will be more information about the implementation of this at the end of May.
Yesterday, the government also published new statistics that show businesses have benefitted from over £14 billion in loans and guarantees to support their cashflow during the crisis. This includes 268,000 Bounce Back Loans worth £8.3 billion, 36,000 loans worth over £6 billion through the Coronavirus Business Interruption Loan Scheme, and £359 million through the Coronavirus Large Business Interruption Loan Scheme.
Mike Cherry, National Chairman of the Federation of Small Businesses, said:
“The Job Retention Scheme is a lifeline which has been hugely beneficial in helping small employers keep their staff in work, and it’s extension is welcome. Small employers have told us that part-time furloughing will help them recover from this crisis and it is welcome that new flexibility is announced (today).”
Fintan O’Toole, Director/Owner of HR Dept (South London) said:
"This is welcome news, employers should now start planning how and when they can bring employees back to work with some confidence that they will be able to do this on a phased basis. The devil will be in the detail and it will be important that records of who has been furloughed and when are kept as there is likely to be extensive audits of claims when the scheme come to an end."
Last month, Croydon BID's chief executive, Matthew Sims, talked to Fintan O'Toole, about furloughing. Fintan provided some very useful advice and insights to businesses.
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