All you need to know about the Coronavirus Job Retention Scheme
All you need to know about the Coronavirus Job Retention Scheme
On 20 March 2020, the government announced the Coronavirus Job Retention Scheme (CJRS) to protect employers and employees due to the Covid-19 pandemic.
On 26 March 2020, the government published guidance on the CJRS. The government updated its guidance on 4, 9, 15, 17 and 20 April 2020.
The CJRS is a ‘temporary’ scheme open to employers starting on 1 March 2020 and currently ending at the June 2020. The CJRS is designed to support employers who have been severely affected by Covid-19. There is no financial limit on what employers can claim.
Employers can apply to HMRC for a grant to cover wages for their employees, which will cover the lower of 80% of the wages of retained employees to a maximum of £2,500 each a month plus employer’s National Insurance Contributions and employer’s minimum auto-enrolment employer pension contributions of 3%.
Wages include: (a) regular wages paid to employees; (b) non-discretionary overtime; (c) non-discretionary fees; (d) non-discretionary commission payments; and (e) piece rate payments. Wages does not include: (a) tips; (b) discretionary bonuses; (c) discretionary commission payments; (d) non-cash payments; (e) non-monetary benefits like benefits in kind (e.g. a company car); and (e) salary sacrifice schemes (including pension contributions) that reduce an employees’ taxable pay.
The CJRS is open to all UK employers that have created and started a PAYE payroll scheme on or before 19 March 2020, whose employees were notified to HMRC on an RTI submission on or before 19 March 2020 and have a UK bank account. Where a company is in administration, the administrator will be able to access the CJRS.
The CJRS applies to all employees who were on PAYE payroll on 19 March 2020 who are “furloughed” rather than being laid off or dismissed by reason of redundancy due to Covid-19.
The HM Treasury Direction issued on 15 April 2020 states that an employee is a furloughed employee if: (a) the employee has been instructed by the employer to cease all work in relation to their employment; (b) the period for which the employee has ceased (or will have ceased) all work for the employer is 21 calendar days or more, and (c) the instruction is given by reason of circumstances arising as a result of coronavirus or coronavirus disease.
The HMRC portal to apply for grants under the CJRS opened on 20 April 2020.
Please use the links below to check your eligibility as an employer for the CJRS and find out what information you will need to make a claim.
HMRC Guidance
Check if you can claim for your employees’ wages through the Coronavirus Job Retention Scheme
Work out 80% of your employees’ wages to claim through the Coronavirus Job Retention Scheme
Coronavirus Job Retention Scheme: step by step guide for employers
HM Treasury Direction
Treasury direction to HMRC in administering the Coronavirus Job Retention Scheme
Apply for CJRS grants
Claim for wages through the Coronavirus Job Retention Scheme
Contact our specialist employment solicitors
It is a difficult time for businesses and individuals alike. If you have concerns about your business or your obligations and responsibilities as an employer at this time, we can advise you. Do not hesitate to contact our employment team on 03456 381381, or email employment@ibblaw.co.uk
