The UK’s return to work plan – updates to CJRS & SSP recovery

With the UK lightening lockdown measures and ideas being put forward to allow a safe and successful return to work; the Chancellor has announced updates and changes to the Coronavirus Job Retention Scheme and Statutory Sick Pay recovery.

The changes see a reduction in the subsidy and a requirement for the employer to fund the cost of NIC and pension contributions on a phased basis to the end of October, when the furlough scheme finishes.

In this post we will be discussing the updates, and what this means for your organisation. If you are unfamiliar with the scheme you can read our original post “Coronavirus Job Retention Scheme – What we know so far” to learn about when the scheme was originally launched.

Job Retention Scheme Claims

June

The Government will continue to fund 80% of employees’ wages under the Job Retention Scheme. However with the gradual return to work, the scheme will close to new entrants on 30th June. From this point onwards, employees can only be furloughed if those employees have been furloughed for a minimum 3 weeks prior to the 30th June.

Consequently, the final date that an employee can be furloughed for the first time is the 10th June.

July

The Government will continue to fund 80% of furloughed workers wages for eligible employees’. Claims relating to furlough leave periods up to the 30th June must be submitted to HMRC by 31st July.

August

The Government will continue to fund 80% of employees’ wages through the CJRS up to a maximum cap of £2,500. However, from 1st August, the Government will NOT be funding any employers National Insurance contributions or Employer’s Pension contributions. Employers will be required to fund these payments from their own funds.

Claims that Dataplan have been processing on behalf of clients to date suggest that this, on average will reduce the total value of amounts claimed from HMRC by 6.9%.

September

From 1st September the Government will reduce the furlough subsidy to 70% of employees’ wages (capped at £2,187.50). The employer will be required to fund the employers NIC and pension contributions, and as we understand the revised rules, the employer will make up the employees earning to the 80% mark subject to a cap of £2,500.

October

The Government subsidy will reduce to 60% (capped at £1,875). The employer will be required to pay the employer’s NIC and pension contributions, and will also fund the difference from the 60% subsidy up to 80% of the ‘normal’ wages paid through the scheme subject to the cap of £2,500.

Part Time Working

From 1st July 2020, businesses using the scheme will have the flexibility to bring previously furloughed employees back to work part-time – with the Government continuing to pay 80% of wages for any of their normal hours they do not work up until the end of August.

This flexibility comes a month earlier than previously announced to help people get back to work.

Covid-19 Statutory Sick Pay Recovery

In March 2020, the Government announced the Statutory Sick Pay Rebate Scheme which would allow employers to recover 14 days of SSP for employees affected by the Coronavirus either directly, or indirectly through shielding.

The HMRC portal for making these claims went live on the 25th of May 2020.

Employers are eligible to use this scheme if:

• The claim is for an employee who has been off sick due to Coronavirus.
• A PAYE scheme was in operation before the 28th February 2020.
• Fewer than 250 employees were on the payroll before 28th February 2020. Connected companies and charities can claim if the total number of employees across all PAYE schemes is less than 250.

The rebate will cover a maximum of 14 days SSP and is payable in respect of employees unable to work on or after the 13th March 2020 as a consequence of the following:

• They have Coronavirus
• They are self-isolating and unable to work from home
• They are shielding because they have been advised that they are at high risk of severe illness if they contract the virus