Coronavirus Job Retention Scheme - August Onwards
What do employers need to do from August onwards?
What do employers need to do from the 1st August?
From 1st August Coronavirus Job Retention Scheme (CJRS) will continue to provide grants for furloughed employees, but will no longer be funding the employers' National Insurance (NI) and pension contributions. Employers will now have to make these payments from their own resources for all employees, whether they are furloughed or not.
What do employers need to do from the 1st September?
- From 1st September, the government will pay 70% of wages up to a cap of £2,187.50 for the hours furloughed employees do not work
- Employers will need to pay 10% of furloughed employees' wages to make up 80% of their total wages up to a cap of £2,500. The wage cap is proportional to the hours not worked
- Employers will continue to pay furloughed employees' NI and pension contributions.
Job Retention Bonus
The Job Retention Bonus allows employers to claim a one-off payment of £1,000 for every employee they have previously received a grant for under CJRS and who remains continuously employed through to the end of January 2021.
To be eligible, the employee must have received earnings in November, December and January and must have been paid an average of at least £520 per month, a total of at least £1,560 across the three months.
Employers will be able to claim the bonus after they have filed PAYE information for January 2021, and the bonus will be paid from February 2021.
For more information you can visit GOV.UK. More detailed guidance, including how you can claim the bonus online, will be available by the end of September.
What do employers need to do now?
If employers intend to claim the Job Retention Bonus, they must:
- ensure all employee records are up to date
- accurately report employees' details and wages on the Full Payment Submission (FPS) through the Real Time Information (RTI) reporting system
- make sure all CJRS claims have been accurately submitted and they have told us about any changes needed (for example if they've received too much or too little).
Paying Workplace Pension Contributions
The Pensions Regulator (TPR) would like to remind you that your workplace pension duties apply whether you staff are working or furloughed as part of the CJRS. However, since the beginning of August 2020, you have needed to pay the pension contributions and NI contributions for your furloughed staff. You will still be able to claim the lower 80% of staff wages or £2,500 per month for these staff, reducing to the lower of 70% or £2,187.50 per month in September and the lower 60% or £1,875 in October, with the scheme closing on 31st October.
If you would like further information on this then please give us a call, our experienced accountants here at Parker Whitwood can help with all of your Payroll needs.