October 9, 2020
Authored by: Mark Kaye and Jeremy Bark
Less than two weeks after the announcement of the Job Support Scheme (“JSS”) and with just over 3 weeks until the Coronavirus Job Retention Scheme (“CJRS”) ends, the Chancellor of the Exchequer has, today, made an announcement setting out the details of a targeted furlough scheme designed to support businesses that are legally required to shut their premises as part of further lockdown measures.
Although it has been labelled by the Chancellor of the Exchequer as an expansion of the JSS, it looks very much like an extension of the CJRS, albeit in a more limited and targeted form.
Key details of the local furlough scheme
The key details of the scheme, which will apply to all of the UK, are as follows:
- It will apply to employees who are unable to work as a result of their employer being forced to shut its premises as part of local or national lockdown measures over the winter months. These are likely to be businesses in the hospitality sector – particularly, bars; restaurants; pubs and clubs.
- The government will pay two thirds of the salary of those employees who are furloughed under this expanded JSS, up to a maximum of £2,100 a month.
- Employers will not be required to contribute towards wages, but will be required to make National Insurance contributions and pension contributions.
- Employers will only be eligible to claim the government grant while they are subject to lockdown and employees must be off work for a minimum of seven