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Job Retention and Support Schemes

The Coronavirus Job Retention Scheme (CJRS) is the Government’s flagship support measure for businesses during the Covid-19 pandemic. The Scheme currently covers 80% of the salaries of furloughed staff, up to a limit of £2,500 per month. The Government has announced significant changes to the scheme from 1st July 2020, which all employers must ensure they are aware of.

Our FAQs are for general guidance only, and do not constitute and should not be relied upon, as legal advice. Every business and challenge is different. If you are an employer and your business needs specific support and advice for your unique context please contact us at

Job Support Scheme – FAQs Document

Job Support Scheme – Business Case Guidance Document

Last update: 03/11/2020 – 11.03

Under the Coronavirus Job Retention Scheme (‘CJRS’ or the ‘Scheme’), the Chancellor announced an unprecedented level of support to businesses and workers during the Coronavirus outbreak. The Scheme was initially set to run for up to three months and no limit has been set on the level of funding available. The Chancellor first extended the Scheme to the end of June 2020. It has now been announced that the Scheme will be extended to December 2020 and since 1st July 2020 it has been possible for workers to work part time and still make use of the Scheme.
The Scheme does the following:

  • Pays a proportion of the wages of furloughed workers, up to a maximum of £2,500 per month;
  • Applies to all UK businesses;
  • Can be backdated to 1st March 2020; and
  • First payments became available towards the end of April.

The law on lay-off provides for an employer to send an employee home where there is a sudden shortage of work. This can only be done where there is a contractual right to do so or where the employee agrees to this. In such circumstances, the employee may receive a very limited Guarantee Payment – this is currently limited to £150 in total over three months. If lay-off lasts for more than four consecutive weeks or more than six weeks in any 13-week period, the employee can choose to serve notice and claim redundancy. Given that the Scheme allows for employees to be paid far more than a Guarantee Payment, it is likely that the vast majority of workers will choose to be furloughed rather than placed on lay-off. Given the risk of redundancy claims with traditional lay-off, it is also likely that most employers will prefer to use the Government’s Scheme.

These include:

  • Asking employees to use annual leave now;
  • Enforcing annual leave;
  • Requesting employees to take unpaid leave;
  • Requesting employees to reduce their hours;
  • Using lay-off or short-time working clauses;
  • Allowing employees to take extended, unpaid time off for dependants;
  • Considering periods of unpaid Parental Leave;
  • Targeted redundancies of employees in probation or with under two years’ service.

The furlough scheme is one option in the employer’s arsenal to survive the current crisis. If an employer is having to consider reducing employee costs more guidance can be found at

This is a commercial decision. Businesses should consider what their business will need to survive the current crisis and the new landscape thereafter. Often, there will be a reduced need for workers in certain departments right now. However, this may not be the case in due course. Employers should therefore take an holistic view of their staffing needs and record any decisions with an appropriate note of their rationale. Such decisions should be taken in a way that does not discriminate against any workers due to any Protected Characteristic.
Business cases and requirements will differ from employer to employer. However, where a decision taken is underpinned by a sound business case it is not for Employment Tribunals to substitute what they would have done in the same circumstances – businesses are allowed to make decisions.

The decision on flexible furlough should be approached in the same way.

In taking an holistic view, employers should consider other sources of assistance. The following have been announced:

    • The Government has announced that it will defer payment of VAT for a year.
    • It will also make arrangements to cover the payment of Statutory Sick Pay for the first 14 days of absence for employers with fewer than 250 employees.
    • A holiday from business rates will be applied for the 20/21 tax year for the retail, hospitality and leisure industry in England. Cash grants will also be available.
    • The Coronavirus Business Interruption Loan Scheme will provide loans of up to £5million for UK-based employers with a turnover of under £45million.
    • Time to Pay will provide assistance with difficulties in paying taxes due.

In addition, businesses should investigate whether they have business interruption insurance.

All of these, and as more schemes come online, help to present businesses with a full picture of the help available. This will impact on all businesses’ ability to keep staff.

Under flexible furlough, since 1st July 2020 it has been possible for employees to work part-time and be on furlough when they are not working. There is no limit on the level of flexibility and no minimum length of a period of furlough. What is the confirmed cut-off date for employment of a PAYE worker to be covered by the Government’s scheme for furloughed employees?

19th March 2020 – this was updated by the Government and is the day before the Chancellor’s announcement of the scheme. Employers must have put employees on their PAYE payroll and have made an RTI submission to notify HMRC of the employee on or before 19th March 2020. From 1st July 2020 the scheme has been amended to allow a combination of furlough and part time work. In order to be able to use the scheme from 1st July 2020, employees had to have been furloughed at some point by, at latest, 10th June 2020.

For the extended CJRS to December 2020, it seems that there is no need for either employer or employee to have used the scheme previously. Government guidance is contradictory about this, but it seems that the intention is for the extended scheme to be available to all employees on payroll and where an RTI submission has been made before 11:59pm on 30th October 2020.

If an employee is off sick, then they should receive sick pay. Once a period of sickness absence ends, if an employee is furloughed they would then be paid in accordance with their furlough agreement. The Government have confirmed that an employee cannot be in receipt of SSP if they are furloughed.

The Government has confirmed that the rules of furlough require consideration of what hours have been worked by employees and where an employee is fuloughed they are not working. From 1st July onwards, employees should receive at least the NMW for those hours worked, the actual amount to be paid being subject to agreement.

Yes – post-1st July 2020 the Scheme allows furloughed employees to work part-time.

This is essentially a commercial question. This will depend on which roles/employees are necessary to run the business in the meantime (a ‘skeleton staff’) and what the business requires to survive – both until the Government support comes through in late April and in the longer term. Identify potential groups/roles for furlough with rationale for identifying them. Options then include asking for volunteers with a right to refuse certain individuals with key skills.

As a temporary variation to the contract of employment, employers should consult with staff (or any recognised trade union) to reach agreement to furlough. Check your contracts of employment for variation clauses to ease this process. Consideration should be given to who will return under the flexible furlough scheme from 1st July 2020 and on what type of shift pattern. The new scheme allows employers to reach agreement with workers on part-time working arrangements, while the Government will pay a contribution in respect of any time spent on furlough.

Depending on the content of their contract of employment, a worker will need to consent to furlough. Furlough is an alternative to redundancy, so employers faced with this issue should consider what other alternatives might be agreeable. The final alternative would be to start the redundancy process if they refuse, although it is likely that an employer could make a strong case for enforcing furlough in the current situation, even where an employee refuses.

It can (and probably should). Note that this will not happen automatically, but it is advisable to add this to any furlough agreement.

This will depend on the overall outlook for the company. Employers should assess what workforce is still required (both for the current crisis and for the new landscape post-Coronavirus). For example, it may be that some employers will not have the financial capacity to last until the Government scheme comes online. There are other sources of assistance for employers, so companies should take an holistic view of any decision and be able to justify this. Furlough is another option to avoid redundancies. For more information on redundancies, dismissals and varying employee terms and conditions see guidance on these two pages:

Redundancies and Dismissals

Changing employee Terms and Conditions

An employee who is furloughed should not receive sick pay. Employers can claim back from both the Coronavirus Job Retention Scheme and the SSP rebate scheme for the same employee but not for the same period of time. When an employee is on furlough, their employer can only reclaim expenditure through the Coronavirus Job Retention Scheme, and not the SSP rebate scheme. For more guidance on SSP see:

Sick Pay

Yes – the accrual of annual leave is tied to employment, and a furloughed employee remains employed. For the same reason, continuity of employment continues to accrue during a period of furlough.

This is possible, although given the latent discrimination risks we would recommend not to do so. If an employer did wish to do this, they should put in place a transparent policy and apply this in a non-discriminatory manner.

Where an employee works part-time and is furloughed part-time from 1st July 2020, the Government contribution will only be in respect of the time spent furloughed.

Furlough pay from the Government is limited to 80% of a furloughed employee’s wage costs, capped at £2.5K per employee per month. In addition to this, Government guidance confirms that HMRC will pay employer’s National Insurance and minimum auto-enrolment employer pension contributions.

Furlough pay from the Government is limited to 80% of a furloughed employee’s wage costs, capped at £2.5K per employee per month. In addition to this, Government guidance confirms that HMRC will pay employer’s National Insurance and minimum auto-enrolment employer pension contributions.

An employer does not need to waive the eight-week notice period for an early return but can do so if they wish. When the employee does return, she should be paid what she (like any other employee) would be due depending on her circumstances.

Yes. From 1st July 2020, there is no minimum length of furlough period.

Yes, if the employee was set to come back to work after a certain amount of days in isolation, they will be able to furloughed after that.

Yes.  Employers should remember that the minimum period for which an employee can be furloughed is three weeks and that employers can only submit one claim every three weeks.

From 1st July 2020, there will be no minimum length of furlough period.

Yes – although employers who can pay bonuses should consider whether they actually require to use furlough pay to support their business. There is no sign that HMRC will means-test the grant, but employers should think carefully on this. Payment from HMRC will not include any element attributable to bonuses.

Since 1st August 2020, employers are responsible for auto-enrolment pension contributions once more.

Employees transfer where (among other issues) they are assigned to an organised grouping that will transfer under TUPE. Case law differentiates between employees who are permanently incapacitated and those who are temporarily absent from work (or laid off). Applying the case law, it is likely that the furloughed employee would transfer. Conversely, if an employee is not assigned to the organised grouping (as in the case of a permanent move prior to the end of the contract) they would be highly unlikely to transfer.

We do not see that this is necessary, as employees on Maternity Leave are already not working. On their return from Maternity Leave, employees can be furloughed.

Guidance from the Government confirms that this is permitted when on furlough provided that this is allowed by the contract of employment. Often, contracts will prevent employees from working elsewhere; where these clauses exist, an employer could waive this for the duration of furlough leave.

This is possible, although employers cannot force employees to take annual leave. Given the difference in value between holiday pay and SSP, employees are likely to wish to take some annual leave during this time.

Although there is no formal guidance on this point (the guidance makes reference to ‘more than one employer’ as opposed to two jobs with one employer), it is likely that this is possible. The employer will need to claim back 80% wage costs for each job starting from date on which employment in each job ceased and the employee was placed on furlough leave.

There is nothing to prevent this and many people are using their time to volunteer in areas which help the national effort to combat Coronavirus. Employers should be mindful of distinguishing between this situation and that of an employee applying for Emergency Volunteering Leave – for more on this, please see below.

Yes. Government guidance states, in relation to how to calculate how much can be claimed in relation to a specific individual, that the scheme applies to “recruitment agencies (agency workers paid through PAYE)…” It is  for the agency itself to furlough the agency worker.

Yes. Government guidance confirms that employees can be furloughed multiple times. As we have now moved to the new system of flexible furlough since 1st July 2020 there is no minimum length of furlough.

Yes – they can. Employers are not obliged to do so, and any decision to furlough employees should be right for the business (and backed up by a recorded business case), but in the circumstances of an employee struggling due to care responsibilities it may be prudent to furlough them.

Yes – apprentices can be furloughed like any other PAYE worker. They can continue to undertake training in the meantime as long as i) they do not perform services for/to or generate revenue for their employer and ii) they receive at least the relevant minimum wage for time spent training.
The Government have prepared a comprehensive list of FAQs on apprentices at:

Yes – the furlough grant from HMRC is not considered to be ‘access to public funds’. Employees on all categories of visa can be furloughed.

If this is not part of the formal Emergency Volunteering Leave scheme, then it is likely that any ‘volunteering’ would prejudice the employer’s ability to claim a grant from HMRC. This is because the staff would be likely to be regarded as providing a service for their employer.

This is likely to lead to criminal sanctions including fines. In addition, HMRC would be likely to reclaim any financial support obtained fraudulently via a clawback mechanism. The CEO of HMRC has encouraged employees of companies who profiteer from the Scheme to report their employers; this would be extremely likely to afford whistleblowing protection to any such employee.

  • Their employer PAYE reference number;
  • The number of employees being furloughed;
  • National Insurance Numbers for the furloughed employees;
  • Names of the furloughed employees;
  • Payroll/employee number for the furloughed employees (optional);
  • Their Self Assessment Unique Taxpayer Reference or Corporation Tax Unique Taxpayer Reference or Company Registration Number;
  • The claim period (start and end date);
  • Amount claimed (per the minimum length of furloughing of 3 consecutive weeks);
  • Their bank account number and sort code;
  • Their contact name; and
  • Their phone number.

On 30th October 2020, the Government announced that the furlough scheme would be extended to December 2020, representing a significant extension of support for business across the UK.

There are several positions which have exceptions to furloughing restrictions. In the case of company directors, this is centred around whether they are an employee of the business. If they are not an employee then they are not able to be furloughed in the first place. The concept of furlough is that the individual doesn’t carry out any work at all, however there are certain responsibilities of directors who are employees which they may have to do or they will be breaching the companies act. This work can be delivered while the individual is furloughed as long as they aren’t providing services or generating revenue for the business.

The other exceptions are in the case of training, which furloughed employees can participate in as long as doesn’t provide services or generate revenue for the businesses. Apprentices can also continue their training after being furloughed.

Part-time work and furlough has been permitted since 1st July 2020.

Each business should have a clear business case to justify who the business plans to return to work, why and how those plans shall be reviewed. Managers must ensure that any return to work strategy is well-defined and consistent in terms of how the business case is applied. Communication will also be pivotal to avoid possible employee disharmony and complete a smooth transition. It is absolutely crucial that all key concerns are responded to, ensuring consistent and beneficial conversation.  Employers should ensure that they have a robust plan for communicating with employees, to both encourage goodwill and minimise the risks and negativity around returning to work.  It is particularly important for employers to consider the potential impact of returning to work after such a long break on their workers of returning to work.  Please download our Return to Work road map for further guidance.

Yes – there is nothing in the Scheme which prevents an employee being served notice of termination of employment. The amount of notice will depend on whether the employee has normal working hours and the contractual terms for the termination of their employment. If a contract of employment provides that an employer must give an employee at least one week more notice that the statutory minimum, then the notice pay will be based on their contractual pay.

The rules in this area are notoriously complex and it would be prudent for employers to seek specific advice on this point.

As per making a payment in lieu of notice, if an employer has reserved the right to place an employee on garden leave in their contract of employment they may rely on this.  In a period of furlough, there is little practical difference between garden leave and furlough itself – both essentially lead to an employee’s employment continuing but without the need to attend work.  As such, employers without garden leave clauses could achieve much the same effect by having an employee pass their notice period on furlough leave, although it is important to consider the impact of garden leave on some contractual clauses, such as Restrictive Covenants. For more information on dismissals see

Yes – where employers have reserved the right to pay in lieu of notice in a contract of employment, they may rely on this right. However, they should not claim from the scheme in respect of any pay in lieu of notice – only in respect of wages when an employee is ‘working’ their notice. For more information on dismissals see

Use of annual leave, for almost all employers, depends on a system of application and acceptance or refusal of annual leave.  As such, it is perfectly possible for employers to reject applications for annual leave following furlough leave if it does not suit the business.  Employers – especially those whose annual leave year ends later in 2020 – should consider how to make sure the business has sufficient cover while balancing this with the need for employees to use up their annual leave allowance and enjoy some rest and relaxation.  Where employees are unable to use annual leave due to Covid-19, the Government has taken steps to allow this to be carried over in to future annual leave years. This is similar to existing policies where employees who have been on long-term sickness absence are able to carry forward holiday allowance accrued while absent into future annual leave years.

You must keep the following and do so for six years:

  1. the amount claimed and claim period for each employee;
  2. the claim reference number for your records;
  3. your calculations in case HMRC need more information about your claim;
  4. for employees you flexibly furloughed, usual hours worked, including any calculations that were required; and
  5. for employees you flexibly furloughed, actual hours worked

Our position has always been that it is possible to use furlough grant to pay the notice pay of those employees who work their notice period.  The new Treasury Direction has, unfortunately, made this less clear.

The new Treasury Direction states the following:

“Integral to the purpose of CJRS is that the amounts paid to an employer pursuant to a CJRS claim are used by the employer to continue the employment of employees in respect of whom the CJRS claim is made whose employment activities have been adversely affected by the coronavirus and coronavirus disease or the measures taken to prevent or limit its further transmission.”

The phrase “to continue the employment” appears possibly to contradict the previous Employee Guidance which still states “your employer can still make you redundant while you are on furlough”.  However, there are various possible interpretations of this new paragraph. One alternative is that the paragraph read as a whole appears more to prevent fraudulent claims rather than to discourage use of the furlough grant for a period of notice.

We believe that giving the wording of the Direction its ordinary meaning, and reading it alongside the Guidance, there is a low risk for those employers that choose to use furlough grant to pay notice pay where notice is worked.  A period of notice is continuing employment, albeit only for a limited period.

We are also mindful of the duality of purpose of the CJRS – it is to maintain jobs and to sustain businesses.  In our view, if the Government had wished to preclude employers from paying notice by using furlough grant, we think that they would have found some space in the 34-page Direction to state this explicitly.

The information available currently comes from factsheets on the Government website, along with the initial announcement to the House of Commons on 24th September 2020 and further announcements on 9th and 22nd October 2020. The Government’s initial factsheet tells us that the JSS is designed “to protect viable jobs in businesses who are facing lower demand over the winter months due to Covid-19, to help keep their employees attached to the workforce.”
The Government’s hope is that the JSS will assist employers ‘as the economy opens up’. The basic rationale is that, where there is reduced work for an employee, parties can agree that the employee will work fewer hours, the employer will pay the employee for the reduced hours, with the employer and the Government sharing the cost of two-thirds of the hours not worked (up to a cap) and the employee foregoing their pay for the final third. The Government will pay in respect of 62% of unworked hours (capped at £1,541.75 per month), leaving 5% to be paid by the employer (capped at £125 per month)
In relation to businesses which are legally required to close, the Government will pay two-thirds of the salary (capped at £2,100 per month) of employees who are not required to work for at least seven days.
For ease of reference, employers should think of the JSS as being split in two – one for open businesses and one for closed businesses.
The scheme was due to start on 1st November 2020 – dovetailing with the end of the furlough scheme – and run for six months. However, this start date has been postponed due to the extension of the CJRS.

As with the furlough scheme, claims will need to be made through an online portal. However, claims can only be made monthly and only after an employee has been paid by the employer. This is a considerable departure from the furlough scheme.
Payments from the Government will be made on a monthly basis in arrears from December 2020. This may lead to cash flow issues for employers, particularly smaller ones, who may not have the resources to bridge this gap between expenditure and income.

Unlike in the first months of the furlough scheme, it is the employer who will be responsible for NICs and pension contributions. As this is a reimbursement scheme, it seems that employers will also have to pay NICs and pension contributions in respect of the pay that is reimbursed by the Treasury.

The factsheet published on 22nd October 2020 confirms that the JSS will be extended to workers, although strictly this factsheet only applies to the JSS for open businesses. The point of the JSS is, after all, the preservation of viable jobs and it would seem counter-intuitive to reserve this protection only for employees.
A Government policy paper published on 22nd October 2020 confirms that “an individual is an employee for the purposes of this scheme if they are treated as an employee for Income Tax purposes.”

The furlough scheme protected jobs that would otherwise have been made redundant due to Covid-19. The JSS does not look to do that. In announcing the new scheme, the Chancellor stated that the Government are interested in saving those jobs that are viable and that there had to be ‘trade offs and hard choices’. He said that furlough will finish at the end of October as ‘the economy reopens’. He said that ‘we need to create new opportunities and support those in viable jobs’, and that ‘we can and must deal with the real problems’.
Essentially, if a job only still exists because the furlough scheme has allowed it to survive artificially, this is not the sort of job that the JSS is designed to support. Rather, the JSS will support jobs which potentially will exist in future and for which employers currently have a need albeit on shorter hours. These are viable jobs in terms of the JSS.

Without the support of furlough from December 2020, where a job is not viable, cannot even provide a fifth of usual hours and therefore not suitable for the JSS, employers will be faced with fewer means of maintaining this and difficult decisions are likely to be needed.


The JSS will support ‘viable jobs’ where there is a reduced need for working hours. An employee must work at least 20% of their usual hours in order for their employer to use the JSS in relation to that employee.
The 20% minimum of usual hours to be worked is set to be the level for the first three months of the JSS, but it may be increased thereafter – presumably in line with a general economic recovery.
View the Government Fact Sheet at

The scheme will be available for all employers with a UK bank account and a UK PAYE scheme. This is the same as for the furlough scheme as it allows HMRC to monitor applications and pay grants out.
Large employers must satisfy a financial means test, showing that their turnover has dropped. Large employers are those with 250 or more employees. There is no means test for small or medium employers.
In common with the furlough scheme, there is a cut-off date for employees – they must have been on the employer’s payroll by 23rd September 2020 and have been part of an RTI submission to HMRC by the same date.
There is no need for either the employer or the employee to have used the furlough scheme previously.

Yes. Employers must reach agreement with employees to reduce their hours in order to use the JSS. The JSS guidance states:
Employers must agree the new short-time working arrangements with their staff, make any changes to the employment contract by agreement, and notify the employee in writing. This agreement must be made available to HMRC on request.
Our advice is that, as this represents a further variation of contractual hours, employers should prepare JSS agreements in writing and have employees signal their agreement to this, again in writing. Usually this would be by way of a signed variation document; however, if social distancing makes that impractical, we believe that agreement signalled by way of email would suffice for audit purposes. This would be in line with the rules of the furlough scheme.

It is likely that the JSS will not work for all employers and certainly not for all employees. We recommend considering whether the JSS will be appropriate for certain roles and looking to use this as part of a mixed approach. It is possible to negotiate reduced hours without using the JSS and employers may have other options such as temporary lay-offs and short-time working.
The JSS is one of many support options available to employers, and the Chancellor’s announcements included lots of other schemes, mostly in relation to corporate taxes, which can help your business survive these challenging times.

The JSS clearly may be a way of avoiding redundancies. It would be prudent for employers to consider whether they can use the JSS as part of a redundancy consultation, including for those consultations which started before the JSS was announced.
The aim of the JSS is to keep employees “attached to the workforce.” In relation to redundancies, the JSS guidance states that:
“Employees cannot be made redundant or put on notice of redundancy during the period within which their employer is claiming the grant for that employee.”
We think that, on balance, the guidance must mean that an employer cannot make a particular employee redundant or serve them notice of termination due to redundancy during any period in respect of which the employer makes a claim under the JSS for that particular employee. Any other interpretation would be illogical and not in keeping with the aims of the JSS.
We think, then, that practically employers can carry out redundancy consultations while still claiming from the JSS for employees who are at risk of redundancy. However, they must not claim for those employees once they are put on their notice period.
This is of course still subject to final clarification, but it would be surprising if this were not the case.


Businesses anywhere in the UK who are required to close their premises due to Coronavirus restrictions where they are instucted to do so by one of the four governments in the UK. This definition is extended to include hospitality businesses which are required to provide only delivery and collection services from their premises, or food and drink outdoors from their premises.

Where a business is required to close their premises and an employee is required to be off work for at least seven consecutive days as a result, the Government will pay 67% of their salary, up to a cap of £2,100 per month. The employer is only required to contribute employer’s NICs and pension contributions.
In common with the JSS for open businesses, payments will be made in arrears.

New guidance states that an employee cannot be made redundant or put on notice of redundancy during the period within which their employer is claiming the grant for that employee

Yes – further agreement will be required in accordance with the JSS rules for open businesses.

Access the guide on this topic