COVID-19 Furlough Extension: 10 Key Points

HMRC has updated its COVID-19: Furlough extension – ten key points guidance to reflect the extension of the furlough (CJRS) scheme to 31 March 2021.

1. Level of Support

From 1 November 2020, employers can claim 80% of an employee’s usual salary for hours not worked (up to £2,500 per month). Employers may top up the remaining 20% if desired and must pay employer NICs and pension contributions on all payments. The government will review the support level in January 2021 to determine if employers must contribute more.

2. Publicity

HMRC will publish details of employers using the scheme for claim periods beginning 1 December 2020 onwards. Employees can check if their employer has claimed under the scheme.

3. Open to New Entrants

Eligibility from 1 November 2020 includes employers and employees who have never used the scheme before.

4. Eligible Employees – Payroll Dates

Claims are valid for employees on the payroll as at 30 October 2020, provided a PAYE RTI submission was made between 20 March and 30 October 2020. Redundant staff rehired on or after 23 September 2020 are also eligible.

5. No Maximum Number of Employees

The revised guidance removes the previous cap on the number of employees an employer could claim for.

6. Employees Serving Notice Periods

For claim periods starting 1 December 2020, HMRC will issue updated guidance in late November. Employers should exercise caution when furloughing staff serving notice.

7. Full or Flexi-Furlough

Employers can continue to furlough employees for any duration or pattern of work, claiming grants for hours not worked.

8. Retrospective Furlough

Agreements made on or before 13 November 2020 can be backdated to 1 November 2020.

9. TUPE Transfers

The guidance suggests that claims for staff transferring under TUPE after 1 September 2020 may not be permitted. HMRC clarification is pending.

10. Monthly Deadlines for Claims

Claims for periods from 1 November 2020 must be submitted within 14 calendar days after the month-end (or next weekday if the deadline falls on a weekend). Claims up to 31 October 2020 must be submitted by 30 November 2020.

For more details on furlough extension guidance, visit our comprehensive overview.

Information via Lexology – Slaughter and May – Padraig Cronin and Phil Linnard