Furlough Scheme Extended

Last updated on

On Thursday, 5 November, Chancellor Rishi Sunak announced that the Coronavirus Job Retention Scheme (CJRS), often referred to as the furlough scheme, would be extended until the end of March 2021

In this article, we explain what the extension means and discuss which employers and employees are eligible.

Read about the latest furlough updates

Furlough Scheme: what's the latest?

We understand that it can be difficult staying up to date with all the latest changes affecting furlough. This short piece provides you with everything you need to know.

What has changed? 

When the CJRS was first launched back in March, government contributions made up 80% of a furloughed employees' wages – up to a cap of £2,500 per month – as well as employer National Insurance (NI) and pension contributions

From the beginning of November, these contributions will return to 80%, with the same £2,500 monthly cap, an increase in the amounts paid throughout September (70%) and October (60%). However, unlike when the CJRS was initially launched, employers will be responsible for all NI and pension contributions for their furloughed employees

Timeline of the furlough scheme

March 2020

CJRS launched on 20 March and backdated to 1 March. Government contributions begin at 80% of a furloughed employees' wage, capped at £2,500 per month. Government contributions include employer National Insurance (NI) and pension contributions. The CJRS is initially planned to last just three months—March to May.

April 2020

Following the extension of a country-wide lockdown, the CJRS is extended until the end of June.

May 2020

On 12 May, the CJRS is extended until the end of October; however, it is also announced that government contributions will decrease month-on-month from August. Finally, it is confirmed that companies will be unable to furlough an employee for the first time beyond 10 June.

July 2020

Flexible furloughing is introduced from the start of July. Furloughed employees are allowed to return to work on a part-time basis; however, employers become responsible for paying the entirety of an employee's wage for the hours they work. Government contributions remain at 80% for all unworked hours.

August 2020

Employers are required to begin paying NI and pension contributions for furloughed employees. Businesses continue to receive 80% of a furloughed employee's wage from government contributions.

September 2020

Government wage contributions reduce to 70% and employers have to pay 10% of their furloughed employees' wage to meet the minimum 80% mark.

October 2020

The wage contribution is reduced again, this time to 60%. Employers must now contribute a minimum of 20% of furloughed employees' wages.

31 October 2020

On 31 October, the day the CJRS was due to end, Prime Minister Boris Johnson announces that it will be extended until December. Government contributions return to 80% (capped at £2,500 per month), however, employers remain responsible for NI and pension contributions. It is also announced that employees – for the first time since mid-June – can be furloughed for the first time.

5 November 2020

Chancellor Rishi Sunak announces that the furlough scheme will be extended until the end of March.

Who is eligible for the CJRS?


All employers with a UK bank account and UK PAYE schemes can claim for the grant. The employer does not have to have previously used the CJRS to be eligible.


To be eligible for the CJRS, employees must be on an employer's PAYE payroll on 30 October 2020. This means that an RTI submission for that employee must have been made between March and 30 October 2020

Employees can be furloughed regardless of whether they have been previously furloughed. This means that employers can, for the first time since 11 June, furlough an employee for the first time.

If an employee is being furloughed for the first time and was not employed on 19 March 2020, the updated calculations and reference period must be used. For fixed salary employees this will mean 80% of the wages payable in the last pay period ending on or before 30 October. Those on variable pay will receive 80% of the average payable between the start date of their employment or, 6 April (whichever is later) and the day before their extension furlough period begins.

Any employee who has been previously furloughed – or has been employed since 19 March 2020 – will have their pay calculated based on the previous pay reference period. For fixed salary employees, this will relate to 80% of the last pay period ending on or before 19 March.

All employees on variable pay will be eligible to receive the higher of either 80% of the wages earned in the corresponding calendar period in the tax year 2019 to 2020 or, the average wages payable in the tax year 2019/20.

Employees on all types of contract are eligible and, as with the original CJRS rules, employers will need to agree to any working arrangements with employees. 

Those who are shielding or live with someone who is shielding are eligible, as is anyone who has caring responsibilities as a result of coronavirus.

Flexible furlough will also continue; however, employers can only claim for the hours that an employee does not work. The claimable amount can be calculated by reference to their usual working hours in a claim period. Naturally, employers will be responsible for paying employees for all hours worked. 

Employer furlough grant claims should cover a minimum period of seven consecutive calendar days. Employers will need to report the hours worked and the usual hours an employee would be expected to work in a claim period to HMRC. 

Employers remain entitled to top-up employee wages should they wish. 

Can employees that have been made redundant be brought back?

An employee who has been made redundant or stopped working is able to be re-employed and placed on furlough provided that they meet one of two conditions:

  • the employee was on an employer’s payroll on 23 September and a PAYE Real Time Information (RTI) submission including them was sent on or before this date;
  • they were made redundant or stopped working for their company on or after 23 September.

How does an employer claim?

Employers will be able to make the first claim from 8 AM on Monday, 11 November and can be made:

  • in respect of an employee for a minimum seven-day claim window;
  • in advance;
  • in arrears for the period from 1-11 November from the week commencing Monday, 9 November.

Claims for November must be submitted no later than 14 December and HMRC is anticipating that grants will be paid within six working days.

What about the Job Support Scheme? 

The Job Support Scheme (JSS) was planned to come into effect from Sunday, 1 November. 

However, since the CJRS has been extended, the scheme has been withdrawn and postponed for the time being

Unsure about furlough or concerned that your current payroll provider is not able to meet your demands? 

Book a demo with one of our product specialists today. 

PayFit blog author

PayFit blog author


You may also like...

Information on employee tax relief

The extension of the work from home tax relief scheme means that people working from home can apply for tax relief for both the previous and current tax year. 

Tax and NI relief on home-office expenses extension

The temporary exemption of Income Tax and National Insurance Contributions (NICs) for home-office expenses has been extended until the end of the 2021/22 tax year. 

SSP for shielders

From April 1st, individuals on the Shielded Patient List will no longer be eligible to receive either SSP or Employment and Support Allowance (ESA) purely on the basis of being instructed to shield.

Stay up to date with the latest payroll, HR & PayFit news...