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  • Writer's pictureTom from Harken Financial

COVID-19: The Future of Furlough as Chancellor Makes Important Changes

We’ve written extensively about the Coronavirus Job Retention Scheme, as well as how it – and other measures – affect employees and employers alike.

On Tuesday, the Chancellor announced an extension to the scheme. It won’t be extending in its current form, though. It will be changing.

We’ll outline what is known so far and how this affects employees and employers.


So what has changed?

Immediately? Nothing.

The scheme was set to end in July and indeed, it will still remain the same for the next 10 weeks.

Beyond July, it’s been extended until the end of October, but from August there will be more ‘flexibility’ in the scheme.

This is designed to get people back to work and boost the economy.

It will enable furloughed workers to return to work part-time, which is not an option under the current scheme.

At the moment, you are either furloughed or working and there is no middle ground.


How will this affect you if you’re employed?

Beyond the above flexibility, which may involve you being asked to work part-time, there’s little change.

The payment will remain the same. Some employers pay more, but as a minimum you will still be able to receive 80% of your salary (subject to the £2,500 per month cap).

But please read on, as there’s likely to be a larger effect on your employer.


What if you employ others?

We don’t know the full details yet, but Government support will need to be subsidised by you. Employers will be asked to pay a percentage towards the salaries of their furloughed staff.

How this will look is still unknown. Expect further updates from the Government over the coming weeks.

What is known is that the scheme is being extended and Government support will still be available to help you and your business in retaining your staff – beyond July – in an unprecedentedly challenging time.


We’d recommend having a look at the government’s official guidance and press release.

If you need any further advice or guidance, please let us know. You can contact us here.


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