July 9, 2020

The “Coronavirus Budget”

This post was written by: Ilinca Mardarescu

The Chancellor yesterday announced a number of financial measures to get the country back on track and spending.

Crucial amongst this was of course his announcement regarding the CJRS, or Furlough as it is widely known.  

Currently, approximately 9.3 million workers are having 80% of their salaries paid for by the government (up to the £2,500 a month threshold) under the furlough scheme.  The scheme has been extended to October, but with increased employer contributions being tapered between now and the end of October.

As employer contributions start to increase businesses may well start considering redundancies, and the Chancellor is well to aware of that.  However, he rejected calls to extend the scheme citing the fact that the longer people are out of work the more their skills could “fade”.  Instead, he has tried to encourage businesses to keep on employees by awarding them with a £1,000 bonus for every staff member kept on for three months from when the furlough scheme ends in October.

He clarified that this means businesses will only receive the bonus if they pay the employee throughout November to the end of January.  Furthermore, the employees must be paid at least £520 on average, in each month.  

Whether this will be enough to prevent businesses from making redundancies only time will tell. 

For advice on any aspect of ensuring a safe return to work for staff, or any other employment queries, please contact our Head of Employment, Ilinca Mardarescu.