As part of the Chancellor's Summer Statement announcements the existing furlough scheme was brought to a close on June 10th for new entrants and replaced with a flexible furlough from July. The July forward scheme allows employers to bring employees back into work on a pro-rata basis based on demand and the government then cover the remainder of the missing wage for the employee.
An additional announcement was also made at the time for a scheme called 'Job Retention Bonus'. The full details of which have now been revealed.
The 'Job Retention Bonus' pays businesses a one-off £1,000 taxable payment for any previously furloughed employee who is brought back into work and remains in employment until at least the end of January 2021.
The scheme, put in place to save jobs, requires employees to earn at least £520 a month, equivalent to the national insurance lower earnings limit, and must be earning on average at his level from November 2018 to the end of January 2021.
Employers must also be on the RTI (Real Time Information) PAYE reporting scheme and have a UK bank account. Claims for the bonus will be made online from February 2021, using a system much like existing furlough claims. Further details on the scheme will be published in September 2020.
Furlough is currently covering the incomes of 9.5 million jobs, with this month marking the first month where employers are required to contribute toward wage costs. Our furlough scheme calculator will help give an overview of how much support and how much employers contribute over, but for August employers will receive 80 percent of the employee's gross income but will have to pay employers' national insurance and pension contributions out of pocket.