Tapering of Coronavirus Job Retention Scheme
The government is tapering the Coronavirus Job Retention Scheme with the aim of giving businesses the flexibility to bring back furloughed employees part time.
From 1 July 2020, individual firms will be able to decide the hours and shift patterns for their staff, so that they can devise an approach that best works for them. They will also be responsible for paying employees’ wages while in work.
In June and July, the government will continue to pay 80% of people’s salaries. From August 2020 to 31 October (when the scheme ends), the level of government grant provided will be slowly tapered, and businesses will be asked to contribute a share as follows:
- August: The government will pay 80% of wages up to a cap of £2,500. Employers will pay Employer (ER) NICs and pension contributions.
- September: The government will pay 70% of wages up to a cap of £2,187.50. Employers will pay ER NICs and pension contributions and 10% of wages to make up 80% total up to a cap of £2,500.
- October: The government will pay 60% of wages up to a cap of £1,875. Employers will pay ER NICs and pension contributions and 20% of wages to make up 80% total up to a cap of £2,500.
Extension to the Self-Employment Income Support Scheme
The self-employed grant is being extended, with applications opening in August for a second and final grant. There will be parity with the reducing furlough scheme, paying 70% (and not 80%) of average earnings in a single installment covering three months’ worth of profit, capped at £6,570 in total. The eligibility criteria remains the same for the second grant, as it did for the first with individuals needing to confirm that their business has been adversely affected by Covid-19.