The Chancellor Rishi Sunak has announced the Government’s Coronavirus Job Retention Scheme will be extended by a further 4 months from 30th June to 31st October 2020.
The key points are as follows:
- The scheme has been extended from 30th June to 31st July 2020, with no other changes being made to the scheme during this period.
- From 1st August to 31st October 2020, the scheme will still be available to all sectors, but with greater flexibility, namely the ability for businesses to bring back employees on a part-time basis, with employers sharing some of the costs.
Full details have yet to be unveiled by the Government, especially in relation to the second point about how the Coronavirus Job Retention Scheme between 1st August and 31st October 2020 will operate in practice. Details will be circulated once we have more information.
Mr Sunak’s announcement will be welcomed by many businesses in the same way that the extension to the Coronavirus Job Retention Scheme was made in mid-April 2020, especially for those who were contemplating the possibility of commencing collective redundancies for more than 100 employees.
However, it is clear the Government is starting to look ahead to life after COVID-19. Changes will be coming into effect from 1st August 2020, and therefore businesses will need to review arrangements for those who are furloughed, to plan whether there needs to be any redundancies or restructures, as well as deciding how to reintegrate furloughed employees back into work.
The scale of the challenge facing employers is significant, with the latest set of figures showing that at least 25% of all jobs in the UK economy (7.5 million people) are now paid for by the Government through the Coronavirus Job Retention Scheme, with the scheme to date costing over £10 billion.
It is clear the scheme has avoided millions of redundancies, but the question for employers now is how to get back to some form of normality in the next couple of months.
Further advice and guidance will be issued by us in the coming days and weeks for businesses on how they can move on from the lockdown.