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Furlough Scheme – Extension and Development

Many of us expected the Coronavirus Job Retention Scheme (CJRS) to be extended and modified, but the extent of the changes has surprised us.

On 12th May the Chancellor announced the furlough scheme will now continue until the end of October. The current scheme remains unchanged until the end of July and from August employers will be allowed some flexibility in how they use the scheme. The intention is to allow employers the chance to bring people off furlough and back into work on a part time basis and in those circumstances the employer will be expected to pay a contribution to the worker’s pay.

So the alterations acknowledge that we are some way off getting to a “new normal”, many people want to get back to work in some capacity to help secure their jobs, employers will need to get access to more and more people over a phased return and we all avoid a cliff edge. The timing of the announcement is not an accident; given the rules over consultations on large scale redundancies that process would have needed to start in the next couple of days. This new flexible approach gives everyone more time to reflect and plan for a softer landing.

The Chancellor also explained that the government is exploring ways of helping furloughed workers who want to use their time to do additional training or learn new skills.

At the moment 7.5 million workers are furloughed across almost 1 million businesses. These changes allow businesses to plan a transition back to their usual levels of operation.

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