The end of furlough – What next?
Following 18 months of critical support for businesses across the UK, on 30 September 2021, the Coronavirus Job Retention Scheme (CJRS), more commonly referred to as the furlough scheme, will finally come to an end.
In the last few months, the number of employers using the scheme has fallen considerably with businesses able to operate with a sense of normality as the nation begins to ‘get back to work’ following the lift of Government restrictions within the U.K.
During this final month, the Government grant will remain at 60 per cent of an individual’s average salary, leaving employers to cover the remaining 20 per cent for time not worked. This ensures that those who are furloughed continue to receive 80 per cent of their average salary during the hours that they are not working.
However, for those that remain reliant on this support, the end of furlough will mark a big change, not only to their costs but also to their payroll processes.
As the scheme ends, some businesses will need to consider the difficult decision of potential redundancies or a reduction in worker’s hours or pay as they manage employment costs.
Given the impact such decisions will have on employees, employers should seek professional HR advice before making staff redundant and inform payroll of reduction to employee hours as it may affect an employee’s contributions to pensions, student loans, benefits and national insurance payments.
If you need help reviewing your payroll functions post-furlough, speak to our experts at Joshua Leigh & Co. To find out more about our services click here.
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