The Government announced in Parliament today (12 May) that the Coronavirus Job Retention Scheme (the Scheme) will be extended for four months until the end of October for all sectors.

The level of support that furloughed employees will receive will remain the same during the extension. Currently, employees are entitled to receive 80% of their normal wages, up to a monthly maximum of £2,500.

From August, employers will be asked to pay a contribution towards the cost of this furlough pay. The Government press release refers to employers ‘substituting’ the Government contribution, in Parliament, the Chancellor referred to employers ‘sharing’ the cost of the Scheme. Currently, employers can reclaim the entire 80% of normal wages (subject to the cap) from the Government under the Scheme (provided eligibility requirements are met).
 
From August, there will be more flexibility in the Scheme to support the transition back into work, with employers being able to bring employees back on a part-time basis whilst still remaining in the Scheme. It is not clear what this will mean for levels of furlough pay.

More guidance will be provided by the Government by the end of May.

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