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Changes to the Job Retention Scheme in July

By Adam Pritchard

The practicalities...

The changes detailed below deal strictly with the transition and changes made between June and July.  Further updates for August, September and October will become available at a later date.

Claim periods


There is essentially a new Job Retention Scheme in place for furlough periods post 1st July 2020.

Furlough periods that straddle the end of June and beginning of July will be treated as ending on the 30th June and a new claim period will commence from the 1st July. 

Two separate furlough claims will need to be made to differentiate between the cessation and commencement of the old and the new scheme.  

Any claim under the old scheme must be made by the 31st July and should be made before any claims under the new scheme commencing 1st July.



No straddling of months


Claims must now be made to align with the calendar month because the rules are changing at the start of every month and claim periods cannot be shorter than one week.



Who can claim from 1st July?


An employer can only claim the Job Retention Scheme grant for furloughed employees that have been furloughed for a minimum of 21 days at any point between March and June 2020.



Furlough periods


To qualify for a 'Flexible Furlough' claim under the new scheme the employee must have been furloughed for a minimum of 21 days prior to 1st July 2020. 

This means that the latest date that an employee could begin furlough is 10th June 2020.



Maximum numbers


The maximum number of employees that can be claimed for must not exceed the highest number of employees included in a claim up to 30th June.

The exceptions to this rule will principally be for employees returning to work after parental leave and employees that have been TUPED over under succession rules.



Usual hours


From 1st July employees can work and be furloughed in the same pay period, even in the same day, and if employers want to take advantage of the flexibility afforded by the new scheme they will have to calculate the following:


  • Usual hours
  • Actual hours worked
  • Furloughed hours



Furloughed hours


To calculate the number of furloughed hours the employer will have to deduct actual hours worked from the employees usual hours.



The Wage Cap


For July and August the £2,500 cap continues to apply prorated to the number of hours the employee is actually furloughed with an apportionment based on calendar days. 


In Summary:


The next three months are set to see a lot of changes to the Job Retention Scheme as the government tapers off their support and helps businesses back up off their knees and firmly onto their feet.

The most immediate changes over June will be accompanied in August, September and October by a reduction in the grant as employers begin to take back responsibility for the payment of employers national insurance, pension contributions and then a larger portion of salary payments. 

The scheme is set to cease on 31st October.


Tags: Covid-19