Employers to start paying towards staff furlough scheme from August 2020

The government has outlined further details regarding the government job retention scheme (GJRS), which will require employers to contribute to employee costs from August 2020, while introducing extra flexibility from 1 July 2020.

The government will continue to pay 80% of employees wages, capped at £2,500 until October 2020, however, employers will need to start paying national insurance and pension contributions, representing 5% of employment costs, from August 2020.

Employers will be able to bring back furloughed employees part-time from July 2020 and be responsible for paying this proportion of their wages.

Furthermore, from September 2020, the government will begin to phase out the furlough scheme by decreasing payments by 10% and decreasing the maximum payment by £313. Employers will then be able to claim 70% of employees wages, capped up to £2,187, representing 14% of employment costs.

From October 2020, the government will pay 60% of wages capped up to £1,875, a further decrease of £312, representing 13% of employment costs.

The self-employment support scheme has also been extended to October 2020.

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Rishi Sunak, chancellor of the exchequer, said: “Our top priority has always been to support people, protect jobs and businesses through this crisis. The furlough and self-employment schemes have been a lifeline for millions of people and businesses. We stood behind Britain’s businesses and workers as we came into this crisis and we stand behind them as we come through the other side.

“Now, as we begin to re-open our country and kickstart our economy, these schemes will adjust to ensure those who are able to work can do so while remaining amongst the most generous in the world.”