JRS – Update on Government Guidance

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JRS – Update on Government Guidance

JRS – Update on Government Guidance

The Government published its much awaited guidance on the Coronavirus Job Retention Scheme (JRS) last night.

We summarise the key points below:

  • Employers can claim 80% of the furloughed employees’ usual monthly wage costs (up to a cap of £2,500 a month) plus associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that wage.
  • Any UK organisation with employees can apply, as long as they have created and started a PAYE payroll scheme on or before 28 February 2020 and have a UK bank account.
  • Furloughed employees must have been on their employer’s PAYE payroll on 28 February 2020, and can be on any type of contract, including agency contracts, flexible and zero hours contracts. JRS also covers employees who were made redundant since 28 February 2020, if they are rehired by their employer.
  • If an employee is on reduced hours or reduced pay, they will not be eligible for JRS and their employer will have to continue paying their salary subject to the terms of their employment contract.
  • An employer does not need to place all their employees on furlough. However, furloughed employees cannot undertake work for their employer.
  • Employees who receive sick pay or are self-isolating cannot be furloughed, but they can be furloughed afterwards. Employees who are shielding in line with government guidance can be placed on furlough.
  • If an employee has more than one employer, they can be furloughed for each job.
  • A furloughed employee can take part in volunteer work or training, as long as they do not provide services or generate revenue for their employer.
  • Employees can continue to draw Statutory Maternity Pay (or similar) in the usual manner. If the employer offers enhanced contractual pay to women on Maternity Leave (or similar), this is included as wage costs that they can claim through JRS.
  • For full time and part time salaried employees, the employees’ actual salary before tax (as of 28 February 2020) should be used to calculate the 80%. Fees, commission and bonuses should not be included.
  • For employees whose pay varies, the employer can claim for the higher of: (1) the same month’s earnings from the previous year; or (2) the average monthly earnings in the 2019-2020 tax year.
  • All employers remain liable for associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on behalf of their furloughed employees. Employer National Insurance Contributions and automatic enrolment contribution on any additional top-up salary will not be funded through JRS.
  • Furloughed workers must be paid the lower of 80% of their salary or £2,500 even if, based on their usual working hours, this would be below the National Minimum Wage or National Living Wage.
  • An employer can only submit one claim every three weeks, which is the minimum length an employee can be placed on furlough. Claims can be backdated until the 1 March, if applicable.
  • An employer must pay a furloughed employee the entire grant it receives for their gross pay.
  • Wages of furloughed employees will be subject to Income Tax and National Insurance in the usual way.

The full government guidance can be found here.

For more information and to find out the latest on the JRS, click here to read our most recent update.


If your business needs legal support with any issues arising from COVID-19, please get in touch with Jon Taylor.

All information in this document is accurate at the time of writing. It is meant for general information only and is not legal advice.