UK Government extends furlough scheme until the end of October

Employers in the UK received a boost this week when it was announced by the Chancellor of the Exchequer that the Government’s Coronavirus Job Retention Scheme will remain open until the end of October.

The main points announced by the Chancellor were that:-

• Coronavirus Job Retention Scheme will continue until end of October
• Furloughed workers across UK will continue to receive 80% of their current salary, up to £2,500
• The Scheme will continue in its current form until the end of July
• New flexibility arrangements will be introduced from August to get employees back to work and boost economy

The specific changes to take place from the start of August have yet to be disclosed by the Chancellor and it is expected that the details relating to changes will be made available by the end of this month.

The Chancellor advised that from the start of August, furloughed workers will be able to return to work part-time with employers being asked to pay a percentage towards the salaries of their furloughed staff. The intention is that, in such circumstances,  the employer payments will substitute for the contribution the government is currently making, and ensure that employees continue to receive 80% of salary, up to £2,500 a month.

The extension to the Scheme is intended what were forecasted to be significant headcount reductions by UK employers.

In terms of general background information, new statistics published today reveal that the Scheme has protected in the region of 7.5 million workers and almost 1 million businesses.

The Chancellor’s decision to extend the scheme, which will continue to apply across all regions and sectors in the UK economy, comes after the government outlined its plan for the next phase of its response to the coronavirus outbreak.

Please contact one of our employment partners Stuart Robertson or Graham Millar to discuss how we can help you.

The information and opinions contained in this blog are for information only. They are not intended to constitute advice and should not be relied upon or considered as a replacement for advice. Before acting on any of the information contained in this blog, please seek specific advice from Gilson Gray.