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Further details on the extension of the Coronavirus Job Retention Scheme (CJRS) to 31 March 2021

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6th November 2020 5 min read
More details have been released on the extended CJRS that was announced on 31 October 2020.

The CJRS will now remain open until 31 March 2021. For claim periods running to January 2021, employees will receive 80% of their usual salary funded by the government for hours not worked, up to a maximum of £2,500 per month (pro rata where appropriate). Employers pay the employer NIC and employer pension.

The government will review the policy in January for claim periods from February onwards, and reconfirm the level of employer support required from February onwards.

Our previous update on the CJRS extension contains details on eligibility and the support provided which remains the same. This update details changes to making claims and calculations.

Making claims

Employers will be able to claim from 8am on Wednesday 11 November 2020 for end of November payroll.

A key difference to the extension is that the claim deadline has been changed to the 14th of the following month. Claims relating to November 2020 must be made by 14 December 2020.

The closing date for claims up to and including 31 October remains 30 November 2020.

Calculations for employees who were previously eligible for the CJRS

Employees who were previously eligible for the CJRS will continue to have their reference pay and usual hours calculated using the existing CJRS calculation of 80% of usual wages as applied in August 2020. This applies regardless of whether a CJRS claim was made in respect of that employee to 31 October 2020 or not.

Calculations for employees who are newly eligible for the CJRS

For employers claiming extended CJRS for employees who previously didn’t qualify as they were hired between 20 March 2020 and 30 October 2020, providing they have been included on RTI in that period they qualify for extended CJRS. The reference pay and usual hours will be updated to take account of the period covered by the extension.

If an employee was not previously eligible for CJRS, 80% of wages must be calculated for employees.

The pay reference period will be:

  • For fixed-rate employees: 80% of the wages payable the last pay period reported on RTI on or before 30 October 2020
  • For variable pay employees: 80% of the average payable between the start date of their employment or 6 April 2020 (whichever is later) and the day before their CJRS extension furlough periods begins

Directors

Directors who had their annual payment for 2019/20 reported to HMRC on RTI after 19 March 2020, can now be included in the extended CRJS scheme. Earnings reported after 19 March 2020, or at any point up until 31 October 2020, can be used as reference pay to calculate average monthly earnings up to the £2,500 cap.

Interaction with other Coronavirus Job Schemes

The launch of the Job Support Scheme has been postponed.

The Job Retention Bonus (JRB) will not be paid in February 2021, and the government will introduce a retention incentive when appropriate.

If you have any questions or concerns regarding the extension of the Coronavirus Job Retention scheme, please do not hesitate to get in touch.