The whole world is going through trying times. We’ve seen businesses collapse, economies struggling, and unemployment. Some governments took strong action against unemployment. UK’s Corona Virus Government Contract Jobs Retention Scheme is one of the many heroic actions taken by the UK government.
What’s the Corona Virus Job Retention Scheme?
In July 2020 about 9.5 million people were unemployed due to the pandemic. Coronavirus job retention scheme came in like a breath of fresh air in these trying times.
But like all good things, the CJRS comes to an end. The government contract jobs scheme is now in its second and final phase, which runs from 1 July 2020 to 31 October 2020. This phase provides a transition from Government support to employers to meet the cost of employing.
From 1 July 2020, furloughed employees return to work on reduced hours under the flexible furlough rules. With employers paying the employees as usual for the hours that they work and claiming a grant under the CJRS for the remainder of their normal hours. Employees who were not furloughed for at least three consecutive weeks prior to 1 July 2020 are not eligible for a grant under the scheme from July onwards (unless the employee returns from statutory leave).
During the final phase of the scheme, employees will continue to receive 80% of their pay up to the equivalent of £2,500 a month – this is known as minimum furlough pay.
From 1 August 2020, the financial support provided under the scheme starts to reduce. For claim periods on or after 1 August 2020, employers cannot claim back the employer’s National Insurance and minimum pension contributions on grant payments but must instead meet these costs themselves. For September, employers can only claim 70/80th of the employee’s minimum furlough pay; this reduces to 60/80th for October. However, furloughed employees will continue to receive their minimum furlough pay, with the employer making up for the shortfall.
Do you Get a Bonus in Government Contract Jobs?
When the scheme comes to an end, employers will need to assess their staffing requirements and decide whether they can bring furloughed employees back to work. The Government is keen that they do. To encourage employers to retain furloughed employees, they will pay for government contract jobs of £1,000 for each furloughed employee who is employed continuously from the end of the CJRS until 31 January 2021.
To qualify for the bonus, the employee’s earnings during this period must, on average, be at least equal to the lower earnings limit for Class 1 National Insurance purposes, set at £120 per week (£520 per month) for 2020/21. The Government contract jobs will pay the bonuses from February 2021.