The Chancellor of the Exchequer, Rishi Sunak, announced yesterday that the Coronavirus Job Retention Scheme (JRS) will be extended until 31 March 2021. This significant move means that the planned Job Support Scheme (JSS) and Job Retention Bonus will be put on hold.

Although we’re waiting for full guidance (due on 10 November), we know that employers will be able to furlough employees and claim 80 per cent of their usual salary (up to £2,500 per month) up to January 2021. This marks a return to the original structure of the JRS, and moves away from the reduced levels of support provided to employers during September and October 2020. The government has said that it may change the percentage level of contribution for February and March 2021.

There is no requirement for employers to have used the JRS before now, and the 'flexible furlough' will still be available (i.e. employees may be furloughed on a part-time basis). In a move that is even more advantageous, employees who were employed on 23 September 2020 but who were made redundant after that date can be re-hired and placed on furlough. This may be particularly useful for employers who made redundancies in preparation for the introduction of the JSS.

We will need to see the full guidance, but the pay reference period for newly furloughed employees will be different for employees who have previously been furloughed.