With the Coronavirus Job Retention Scheme (CJRS) to remain in place until September 30th, 2021 in the hope of aiding economic recovery, we are going to look at some of the key milestones of the scheme so far and how the scheme will change between now and September.
The government paid 80% of furloughed employees wages up to a cap of £2,500, as well as employer National Insurance contributions and pension contributions. The rules at this time meant that employees had to be fully furloughed for a minimum of 21 days, and they were not allowed to work while they were on furlough.
CJRS entered its second phase on 1 July 2020, and during these few months, the CJRS was only available to employers that have used CJRS 1 and only for employees they have previously furloughed. The government contribution to employees’ wages reduced month-on-month as the scheme was winding down. There were also some benefits to this part of the scheme, as flexible furlough was introduced, allowing furloughed employees to return to work part time, with no minimum furlough period.
CJRS was once again due to end, but after mounting pressure, the scheme was extended at the eleventh hour, initially until March and then April of this year. The extended months of the furlough scheme were nicknamed CJRS 3 as it brought with it a new set of scheme rules, including the 80% government subsidy being reinstated.
During the Budget, the chancellor announced that the furlough scheme would be extended yet again, and this time, it has been extended until the end of September 2021. With this extension, apart from eligibility changes in May, the rules will continue as they are currently until the end of June. However, the levels of subsidy support will change again from 1st July, where employers will be asked to contribute a percentage of their employees' wage from July onwards as the scheme winds down.
The past year has been very frustrating for payroll processors. Not only had you the added workload of processing furlough pay and making subsidy claims, but you also had to learn about the various changes to the Coronavirus Job Retention Scheme.
There was a lot of time involved in learning, and keeping up to date with changes, which were being announced very frequently. At the beginning, there were times when changes were even being made every week, and it was difficult to keep up to date with the latest guidance.
At BrightPay, we kept the payroll software up to date to cater for the relevant scheme changes. We tried to automate as much as possible in the payroll software to make your life easier. BrightPay has a furlough pay calculator, including support for flexible furlough, which is something many other payroll software providers did not cater for. We also have a CJRS claim report, to make it easier for users when calculating amounts for furlough claims.
In a recent survey, BrightPay achieved a 98.6% rating for our overall handling of COVID-19 including customer support, payroll upgrades, COVID-19 webinars and online support. We also won a COVID-19 Hero Award, and this is because of our response to COVID-19 and how we have helped our customers throughout the past year. The judges recognised that we went above and beyond to support payroll professionals at a time when they were under pressure with government schemes and trying to interpret guidance.
Join our free webinar where we will discuss CJRS rule changes, furlough extensions and other HMRC quirks.
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