Today the Chancellor announced an extension of the Coronavirus Job Retention Scheme, supporting workers who are unable to work due to COVID-19 and will continue to provide 80% of workers wages until October 2020.
Huge relief to employers and workers as lockdown continues
The announcement today by Rishi Sunak will come as a huge relief to many employers and workers who have been concerned of a sudden end to the scheme which started in March, which could have resulted in a large scale redundancies for millions of workers in the UK.
Sunak has confirmed an extension of four months to the scheme taking it to October 2020, with the expectation that the government will continue to fully subside the 80% wage of workers till July, thereafter a phasing of back to work and easing of lockdown and employers starting to pay salaries themselves again.
This extension will mean the government has provided a total of eight months of support to UK workers and businesses during the pandemic.
What will happen from August 2020 ?
From August to October 2020, the scheme will continue for all industries and sectors but with the government transitioning away from fully funding workers salaries but at different times depending on which sector is out of lockdown first. For example, the expectation is that the hospitality sector will require the most support versus other sectors, who it is hoped are able to open up for business earlier.
Employers can start to bring back furloughed workers part time from August or earlier if they can, and would be expected to share the funding of their worker’s wages so as to ensure workers are guaranteed to receive at least 80% of their wages until the scheme ends in October 2020.
More details on the next phase of the scheme will be released at the end of May.
Written by Shaima Todd.