On Saturday, the government announced that the Coronavirus Job Retention Scheme (CJRS) will continue until 1 December 2020 with grants covering 80% of wages, while implementation of the Job Support Scheme (JSS) has been delayed.
This change has been brought about by the lock down to be introduced from Thursday, 5 November. Many MPs felt that the JSS provided insufficient support during a lock down.
The new national restrictions will apply from 5 November to 2 December 2020, but the financial support for employers applies from 1 November as the furlough scheme operates on full calendar months.
What support is given under the CJRS?
The CJRS will continue in force with the same conditions as applied in August 2020.
The grant paid to employers will pay for 80% of the employee’s current wages for time not worked, up to £2,500 per month. The employer must pay for all the employer’s NIC and employer’s minimum workplace pension contributions on those wages.
The employer can top-up the employee’s furlough pay at their own expense if they wish to.
Which employees qualify?
Employees who were on the employer’s payroll on 30 October 2020 will qualify to be included in CJRS claim for November; they do not have to have been included in an earlier CJRS claim. The employee must have been paid by the employer, and that pay must have been reported on a RTI return before midnight on 30 October.
Employees on any type of contract can qualify, including zero hours, although more detail on whether contractors or directors are included is expected in the next few days.
Flexible furlough will be permitted alongside full-time furlough, so staff may be brought back part-time to say, set up the premises for the lifting of national restrictions, or to prepare for Brexit.
The same rules for flexible furlough will continue to apply as they have done since 1 July, so the employee may be furloughed for a few days or hours per week. There appears to be no minimum time set for furloughed hours or working hours.
However, each furlough claim must be for a period of at least seven consecutive calendar days.
Which employers qualify?
All employers with a UK bank account can claim support under the extended CJRS, there is no financial test to pass for larger employers as applies for the (now postponed) JSS.
Charities and not-for-profit organisations can also claim in respect of their employees. However, public sector bodies and publicly funded organisations are not expected to use the scheme.
How to claim?
The claim process will be very similar to that which has applied so far under CJRS, the employer will have to report the hours the employee has not worked in a claim period, and the usual hours.
It is not yet clear whether the employee’s pay must be reported on an RTI return before the CJRS grant is submitted for November pay periods. Further details and legislation are expected to be published shortly.
There was no new information about support for the self-employed, so we must assume the next SEISS grant will be given at 40% of average profits, although if this could change before applications for those grants open.
Where businesses have been required by law to close, they will be able to apply for a support grant from their English local authority, based on the rateable value of their business premises:
|Rateable value of premises||Grant payable per two weeks|
|Up to £15,000||£667|
|£15,001 to £50,999||£1000|
|£51,000 or more||£1500|
Different local business grants will be available in Wales, Scotland, and Northern Ireland.
Mortgage payment holidays will no longer end today. Borrowers who have been impacted by coronavirus and have not yet had a mortgage payment holiday will be entitled to a six month holiday, and those that have already started a mortgage payment holiday will be able to top up to six months without this being recorded on their credit file.
Consumer Credit holidays
The Financial Conduct Authority will suggest to its members several measures to support those financially affected by coronavirus. It suggests that consumer credit customers who have not yet had a payment deferral under our July guidance can request one. This could last for up to 6 months unless it is obviously not in the customer’s interests. Under its proposals borrowers who are currently benefitting from a first payment deferral under our July guidance would be able to apply for a second deferral.
For high-cost short-term credit (such as payday loans), consumers would be able to apply for a payment deferral of one month if they have not already had one.
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