COVID-19 Lockdown Update: Furlough Scheme Extended and Further Economic Support announced

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Today, we’d like to bring you an update on the Governments next phase of its response to the Coronavirus outbreak. You would have heard the news at the weekend that England will be going into lockdown from this Thursday, 5th November. We hope that you are doing as well as possible in these difficult times. Now more than ever, we’ll be working hard to support MI businesses in any way we can. We will continue to generate content that gives you important business updates, and keeps you up to date with news and developments. You know where we are if there’s anything we can do to help.

 Here is a summary of some of the key announcements so far:

Furlough Scheme Extended

The key headlines:
  • The Job Support Scheme, which was meant to start from 1st November, will be postponed.
  • The Job Retention Scheme, which was meant to close on 31st October, will now be extended until December which means employees can continue on furlough.
  • The extension allows both full and flexible furlough.
  • Employees can be part-furloughed and part working.
  • There is no definitive word on whether Director’s can claim or not yet.
  • Employers/employees do not need to have used furlough/been furloughed before to use it now.
  • Employees who started (and had been paid at least once) by 30th October can be furloughed.
  • Employers can claim the full 80% but will have to cover the pension contributions and Employers National Insurance.
What next? 

If you are required to close, you clearly need to let your employees know as soon as possible and may need to send them a furlough leave agreement. Here, our partner Nicky Gleadow at The HR Point has provided some guidance on the next steps you need to take, and has provided some suggested wording for communication with your employees:

Employees who were furloughed/ flexi-furloughed up to the end of October: If your furlough leave agreement contained this clause (or similar) :“This agreement ends when the government’s Coronavirus Job Retention Scheme closes (expected to be 31 October 2020)” you can rely on the existing agreement.

Employees who you were having back to work as the furlough scheme was ending who you would like to re-furlough or who you had said you were putting them on the JSS Scheme:  you need to let them know this is changing due to the Government’s announcement.

Here is some wording for urgent communication to employees:

You may have seen that the government has made a last minute decision to extend the furlough scheme. The government has said that the extended furlough scheme will remain open until December.  As a result of this extension, the start of the Job Support Scheme (JSS) will be delayed so that it starts after the end of the extended furlough scheme.

[For an employer where there is already a JSS agreement in place]  Although we are grateful to you for agreeing to enter into the JSS scheme, we now need to ask that you agree to be furloughed until December instead.  This has the advantage of ensuring that you receive a higher percentage of capped pay than was available under the JSS scheme.   I should be grateful if you could reply to this email confirming your agreement to remain on furlough until December on the existing furlough pay [and hours].

[For an employer where no JSS agreement is in place and employee already on furlough]: As you are already on furlough/flexi-furlough, we propose to continue the existing furlough arrangements until December.  I should be grateful if you could reply to this email confirming your agreement to remain on furlough until December on the existing furlough pay [and hours].

[For an employer where no JSS agreement is in place and employee not on furlough]: Given the impact that the lockdown is likely to have on our business, we would like to ask that you to agree to be furloughed/flexi-furloughed until December.  I have attached / will send in due course a document setting out the arrangements we would ask you to agree.  This reflects the arrangements we have in place with other furloughed employees.

We are expecting further guidance on Furlough over the next few days, and we will update you again when this is available. 

Economic Support

Businesses with physical premises legally told to close under national or local restrictions will receive grants as follows:

  • Properties with a rateable value of £15,000 or under will receive grants of £667 per two weeks of closure (£1,334 per month).
  • Properties with a rateable value of over £15,000 and less than £51,000 will receive grants of £1,000 per two weeks of closure (£2,000 per month).
  • Properties with an rateable value of £51,000 or over will receive grants of £1500 per two weeks of closure (£3,000 per month).

We await more details on how to claim these grants, however we expect that these will be via the local councils as per the previous grants. Again, as soon as we know more, we will let you know.

You can read the full announcement on Furlough and Economic Support on the Government’s website here: www.gov.uk//furlough-scheme-extended-and-further-economic-support-announced

For MIA Members – Exclusive Webinar – Your Questions Answered: The Biggest Issues UK Businesses Face

At 10am on Thursday 5th November, the MIA’s trusted Business Support Helpline partner, Croner, will be holding a Webinar which will address the new developments and answer any questions that you may have.

During this insightful session, specialist speaker Amanda Chadwick will be revealing the biggest issues facing UK businesses right now, as analysed by Croner’s dedicated advisory team.

Join this session for:

  • ‡  Recommended actions from specialist advisors
  • ‡  Vital updates and changes
  • ‡  Basic employment law practice
  • ‡  What businesses like yours are seeking guidance on
  • ‡  How you can take a proactive approach
  • ‡  Live answers to your own questions

 Register your place here –MIA Members will need a scheme/client number when registering. If you don’t have this already, please email alice@mia.org.uk.

That’s all for now, but we will of course keep you updated on any further guidance and developments. Please do get in touch with Alice if there’s anything at all that the MIA can support you with.