From today (1 September 2020), employers must now contribute at least 10% of the cost of those on furlough leave under the Coronavirus Job Retention Scheme (CJRS).
In addition, employers are required to pay National Insurance and pension contributions for their staff.
Employees can still be flexibly furloughed, allowing them to work part-time and be furloughed for the remaining days that they would usually work.
Since March, the scheme has paid 80% of the wages of workers on furlough leave, up to a maximum of £2,500 per month.
From next month, the payments that an employer is expected to make will increase further, with the government contribution dropping to 60%. Employers’ contributions will rise to 20% of the wage costs, together with National Insurance and pension contributions.
The furlough scheme is due to end all together on 31 October 2020.
The increased cost of the scheme is likely to put pressure on many businesses and force them to start making difficult decisions regarding redundancies.
For expert advice on the new changes, and the processes that must be followed if you are considering reducing your workforce, please call 0345 646 0406 or fill in our online enquiry form and a member of our Team will be in touch.