Coronavirus Job Retention Scheme Extension

Latest update:

HMRC has now published further guidance for employees who have been made redundant and are placed on furlough.

From 1 December, you cannot claim furlough payments from HMRC for any employees who are serving contractual or statutory notice periods. This also includes employees who are serving notice of retirement or resignation.

A claim for furlough can still be submitted to HMRC for periods up to and including 30 November. However, if a furlough payment is received within this period, it cannot be used to substitute a redundancy payment to your employee and must be paid in addition to the amount due to them as redundancy pay.

This new guidance will need to play an important part in your cashflow planning if you are considering the possibilities of redundancies.

On 5 November, the Government announced the Coronavirus Job Retention Scheme (CJRS), would be extended for a further 5 months. The furlough scheme will now run until the end of March 2021. This means that employers can carry on furloughing their employees and claiming a furlough grant from the government throughout this period.

What are the rules?

The CJRS will broadly follow the same rules as they stood in August, where employers can furlough (wholly or partly) their staff and pay at least 80% of their usual pay for hours they did not work in the pay period. The employer can then reclaim 80% of an employee’s wages for unworked hours back from the government (up to a cap of £2,500), although the employer is required to pay employer pension and employer national insurance costs without reimbursement, in addition to an employee’s pay for worked hours. This level of support will be reviewed by the Government in January 2021.

HMRC will publish details of employers who make claims under the extended CJRS scheme, starting from December. Full details will be included in full guidance which will be published on 10 November 2020.

The main difference to the scheme is that the criteria for staff being furloughed has now changed:

  • Employees are not required to have been on a CJRS claim previously. Similarly, employers who have never claimed before are also now eligible to claim.
  • The scheme is also now open to employees who were employed at 30th October 2020 and were included on the employers’ payroll on or before 30 October 2020 (and notified to HMRC via an RTI submission on or before 30 October 2020). This could potentially mean that you are now able to furlough employees who were previously not eligible for the furlough grant.
  • Employees that were employed and on the payroll on 23 September 2020 who were made redundant or stopped working afterwards can be re-employed and claimed for. The employer must have made an RTI submission to HMRC from 20 March 2020 to 23 September 2020, notifying a payment of earnings for those employees.
  • For new employees that are being put onto furlough, their reference pay is:
    • 80% of the wage they last received before 30 October, if they are a fixed paid employee; or
    • If they are variable paid, it is 80% of the average wage payable between the later of their start date or 6 April 2020 and the before they go onto furlough.
  • Employees previously on the CJRS, their reference pay will be based on the rules that were used under the previous scheme that came to a close on 31 October.
  • Furloughed employees who become ill, due to coronavirus or any other cause, must be paid at least Statutory Sick Pay (SSP). As under the previous CJRS, it is up to employers to decide whether to move these employees onto SSP or to keep them on furlough, at their furloughed rate, if they will be on sick level for a significant length of time.

Employee Agreement

To be eligible for the grant, employers must have confirmed to their employee in writing that they have been furloughed or flexibly furloughed.

Employers must:

  • make sure that the agreement is consistent with employment, equality and discrimination laws;
  • keep a written record of the agreement for 5 years;
  • keep records of how many hours their employees work and the number of hours they are furloughed for 6 years.

Only retrospective agreements that are put in place up to and including the 13 November 2020, can be noted as having come into effect on 1 November for the purposes of a CJRS claim.

Making a claim

The new deadline for CJRS claims is 14th of the following month and the first claims can be made from 11 November.

You can either make a claim yourself through the Government Gateway or if you use an agent who is authorised to do PAYE online, they can claim on your behalf. You can check which employees you can put on furlough and calculate how much you can claim on the website.

HMRC has reiterated that it’s important to provide the correct data they need to process your claim, otherwise, your payment may be delayed.

For those businesses that are claiming for 100 or more furloughed employees, HMRC has a template you can download to submit your details.

If we are not already preparing claims on your behalf and you require assistance with this, please get in touch with our dedicated CJRS team at

Job Retention Bonus

As the CJRS is being extended to the end of March 2021, the Jobs Retention Bonus will no longer be paid in February. The government will instead redeploy a retention incentive at the appropriate time.