As lockdown restrictions continue to ease across the UK, we take a brief look at the changes to the Coronavirus Job Retention Scheme (CJRS) and the impact this may have on businesses and individuals.
How will the CJRS change in 2021?
Most businesses will be familiar with the CJRS and many state that this has been a lifeline to avoid or at least reduce, the number of redundancies that might have otherwise taken place. However, as we transition into the second half of 2021, and social restrictions continue to ease, the level of support provided by the CJRS will begin to reduce until the scheme ends on 30th September 2021.
From 1st July 2021, the level of grant will reduce on a monthly basis and employers will be required to contribute more towards furloughed employees’ wages. In order for employers to remain eligible under the scheme, you must continue to pay your furloughed employees 80% of their wages, up to £2500.00 per month.
The table below details the periodical changes to the scheme:
| May | June | July | August | September | |
| Government contribution: wages for hours not worked | 80% up to £2,500 | 80% up to £2,500 | 70% up to £2,187.50 | 60% up to £1,875 | 60% up to £1,875 |
| Employer contribution: employer National Insurance contributions and pension contributions | Yes | Yes | Yes | Yes | Yes |
| Employer contribution wages for hours not worked | No | No | 10% up to £312.50 | 20% up to £625 | 20% up to £625 |
| For hours not worked employee receives | 80% up to £2,500 per month | 80% up to £2,500 per month | 80% up to £2,500 per month | 80% up to £2,500 per month | 80% up to £2,500 per month |
| For hours not worked employee receives | 80% up to £2,500 per month | 80% up to £2,500 per month | 80% up to £2,500 per month | 80% up to £2,500 per month | 80% up to £2,500 per month |
Source: https://www.gov.uk
What does the potential impact of the CJRS look like?
Given the support provided by the government to this point, it is clear the true financial impact of the pandemic may not be fully felt for some time yet. Naturally, the hope is that businesses will recover during the summer months. However, many hospitality and tourism bodies are calling for an extra bank holiday in September citing financial concerns. Kate Nichols, Chief Executive of UK Hospitality, tweeted: “Hospitality and tourism has missed out on almost all bank holidays last year and the start of this – we agree, an extra Bank Holiday would be a boost to business, the economy, jobs, and investment”
A recent BBC poll of 50 of the UK’s biggest employers revealed they do not plan to bring staff back to the office full-time. 43 of the 50 firms surveyed said they would embrace a mix of home and office working, with staff being encouraged to work from home two or three days per week.
It seems change will continue to occur throughout the summer months as lockdown measures continue to ease and government support is gradually withdrawn. It seems probable that the new ‘normal’ will be markedly different from the pre-pandemic landscape. With many firms facing financial uncertainty and employers encouraging more flexible working patterns, it seems likely the biggest impact will be on the need for workplace premises, the people that fill them, and the resulting financial fallout.
Should you require any further information or assistance please do not hesitate to get in touch. FJG’s friendly Employment Law team is available on 01206 700113 or by email [email protected].
For more on Employment Law during the Coronavirus pandemic, visit our Coronavirus Legal Advice hub.