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Examples of the Impact of the CJRS Changes

Coronavirus Job Retention Scheme

As you may well know by now, the Coronavirus Job Retention Scheme has been extended to October 2020. There will be some changes to consider from 1st July 2020. Please take the time to read the examples below to see how the changes may impact you. 
If you are still unsure how best to proceed with your business, please do not hesitate to get in touch. We can talk it through together and work out the best plan of action, After all, what works for one may not work for an other. At Together We Count, we know that it's not one size fits all and that's why we treat you all as individuals. 

Together We Count are here for you, always.

Example 1

An employee has been furloughed in April for 4 weeks but is working again. Their employer does not furlough them in June.

The result: The employer can furlough them again, on and off, from 1st July and make a CJRS claim, as they have been furloughed in the past.

Example 2

An employee has been furloughed in March but is now back working again. Their boss reaches agreement with them to furlough them again on 10th June. They will remain furloughed throughout the rest of June.

The result: The employer can make a CJRS claim for the 3 week period to 30th June.

The employer can also furlough them again, on and off, from 1st July onwards and make a CJRS claim, as they have been furloughed in the past.

Example 3

An employee had been furloughed previously for the first 3 weeks of May. They are now back working. Their employer, in agreement with the employee, wants to furlough them again from 21st June.

The result: The employer can furlough the employee again, on and off, from 1st July onwards and make a CJRS claim, as they have been furloughed in the past.

However, I don’t think the employer will be able to make a CJRS claim for the period from 21st June to 30th June inclusive, even if the employee remains furloughed for the whole of July. Why? Because from 1st July onwards claims cannot be submitted for periods that overlap calendar months and, by the end of June, they will only have been furloughed for 10 days.

Example 4

An employee is furloughed for the first time by their employer on 2nd July.

The result: The employer will not be able to make a CJRS claim as the employee has not been furloughed on or before 30th June.

Example 5

An employee is furloughed for the first time by his employer on 9th June and remained so throughout the rest of June.

The result: The employer can make a CJRS claim for the 22 day period to 30th June.

As the employee was a new entrant on or before 30th June, their employer can furlough them again, on and off, from 1st July onwards and make a CJRS claim.

Example 6

An employee is furloughed for the first time by the employer on 18th June and remained so throughout the rest of June.

The result: I don’t think the employer will be able to make a CJRS claim for the period from 18th June to 30th June inclusive, even if the employee remains furloughed for the whole of July. Why? Because from 1st July onwards claims cannot be submitted for periods that overlap calendar months and, by the end of June, they will only have been furloughed for 13 days.

Even though the employee was a new entrant on or before 30th June, as they were not furloughed on or before 10th June they won’t have completed the 3 week furlough period under the present rules therefore the employer won’t be able to furlough them, on and off, from 1st July.

Conclusion

If a business is intending to furlough someone for the first time or to re-furlough someone, then, from a CJRS perspective, it should be done on or before 10th June. There may well be good commercial reasons why this should not be done.

Footnote

If the employer has not furloughed anybody to date and wishes to do so, then at the very latest, they should considering furloughing the employee by 30th June (preferably 10th June), otherwise they won’t be able to claim under CJRS from 1st July onwards. There may well be good commercial reasons why this should not be done.

Businesses need to remember that for CJRS claim purposes from 1st July the number of furloughed employees they can claim for cannot be greater than the maximum number of employees claimed under any previous claim within the period up to and including 30th June.

Please note that these are not Government examples of how the revised CJRS works nor is it their sanctioned interpretation of how the proposed changes will work.




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