Flexible furlough – the final stage

The Government updated the official guidance on the Coronavirus Job Retention Scheme (CJRS) on 12 June. The updated guidance now includes details of how the scheme is to be wound down between July and October, introducing the flexible furlough scheme, which was initially announced on 29 May.

It reflects the Chancellor’s announcement that, from 1 July, employers will only be able to furlough employees who have already been furloughed for the minimum period of three weeks, meaning that the last date on which employers could furlough employees for the first time was 10 June save for the limited exception set out below.

Making claims under the scheme – new timescales

New guidance is provided on the timing of claims under the amended scheme and the closing dates for claims under the old scheme.

  • The first time you will be able to make claims for days in July will be 1 July. You cannot claim for periods in July before this point.
  • 31 July is the last day that you can submit claims for periods ending on or before 30 June.

Flexible furlough

Employers will be able to implement ‘flexible furlough’ from 1 July, including part-time arrangements.

The part-time arrangement is calculated on hourly rates. You will need to agree how many hours your flexibly furloughed employee is going to work in the claim period and record this in a written agreement. They will be furloughed for the rest of their usual hours. The employer will have to pay employees in full for hours worked.

The number of furloughed hours is calculated by subtracting the number of hours the employee actually works in the claim period (even if this is different to what you have agreed) from their usual hours. If you claim in advance and your employee works for more hours than you agreed, then you’ll have to pay some of the grant back to HMRC by correcting your claim. Record keeping is going to be important.

The minimum furlough period (currently three consecutive weeks) will no longer apply – flexible furlough agreements can last for any period.

Changes to the payment scheme: Tapering provisions

A new document sets out the detail of how CJRS grants will be tapered over the next few months.

  • From 1 August, employers will have to pay employer NI contributions and employer pension contributions, with the CJRS continuing to pay 80% of wages up to a cap of £2,500.
  • From 1 September, employers will also have to pay 10% of wages, with the CJRS paying 70% (capped at £2,187.50).
  • From 1 October, employers will have to pay 20% of wages, with the CJRS paying 60% (capped at £1,875).

For details of the changes see guidance at: https://www.gov.uk/government/publications/changes-to-the-coronavirus-job-retention-scheme/changes-to-the-coronavirus-job-retention-scheme

Calculating payments under the flexible furlough scheme

The updated guidance includes worked examples of how to calculate pay, National Insurance and pensions elements for a flexibly furloughed employee. These are complex given the number of different payment patterns staff have. Employers are going to have to set time aside to understand how to calculate grants carefully where part-time working and tapering provisions apply.

See guidance at: https://www.gov.uk/government/publications/find-examples-to-help-you-work-out-80-of-your-employees-wages/examples-of-how-to-work-out-80-of-your-employees-wages-national-insurance-contributions-and-pension-contributions#workout-variable-hours


The updated guidance also acknowledges the announcement made by HM Treasury on 9 June that the 10 June cut-off for furloughing employees for the first time will not apply to those returning from family-related leave. Employees returning from maternity, adoption, paternity, shared parental or parental bereavement leave will still be eligible for the furlough scheme even if they have not previously been furloughed by 10 June, but only if the employer has previously used the furlough scheme for other eligible employees before that date.

Links to all of the updated guidance are available at: https://www.gov.uk/government/collections/coronavirus-job-retention-scheme

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