Chancellor announces changes to Job Retention Scheme

01 Jun 2020

Chancellor Rishi Sunak has announced changes to the government's Job Retention Scheme (JRS), which will be slowly wound down over the next few months.

The changes mean businesses will be able to bring furloughed employees back on a part-time basis from 1 July.

Furloughed staff will continue to get 80% of their salary throughout until the scheme finishes at the end of October. However, employers will be expected to gradually contribute more towards furloughed employees' salaries.

In August, the taxpayer contribution will stay at 80% but employers will have to pay national insurance and employer pension contributions.

In September, employers will be asked to start paying 10% towards people's wages, which will rise to 20% in October.

The cut-off for JRS applications is 30 June, after which new firms will not be able to join and others unable to furlough additional employees.

Commenting on the scheme, Dame Carolyn Fairbairn, Director-General at the Confederation of British Industry, said: 'Introducing part-time furloughing as more stores and factories start to open will help employees to return to work gradually and safely. Many more businesses will feel supported during this vital restart phase.

'Firms understand the scheme must close to new entrants at some point and that those using it in future will need to make a contribution to help manage the costs. However, previously viable firms not able to open until later, particularly in leisure, hospitality and the creative industries, may need further assistance in the coming months.'

Further guidance on the JRS can be found here.