The Government’s Plan for Jobs – the end of Furlough and new Job Retention Bonus

On 8 July the Treasury published its “Plan for Jobs” setting out its plans for protecting jobs and facilitating a financial bounce back. It confirmed that the Coronavirus Job Retention Scheme (CJRS) will end in October after its phased wind down. The government has suggested a four stage response:

  • introducing a new Job Retention Bonus to encourage businesses to retain furloughed workers
  • supporting job hunters with direct help to find work and to gain the skills people need to get a job
  • protecting jobs in the hospitality and accommodation sectors and at attractions by attempting to encourage demand
  • creating jobs with action to get the property market moving and to increase and bring forward infrastructure investment.


To encourage employers to continue the employment of furloughed workers the government announced its intention to introduce the Job Retention Bonus, a one-off payment of £1,000 to UK employers for every furloughed employee who remains continuously employed through to the end of January 2021. To qualify, employees must earn above the Lower Earnings Limit (£520 per month) on average between the end of the scheme and the end of January 2021. Payments will be made from February 2021. We are informed that further detail about the scheme will be announced by the end of July.

Younger unemployed proposals

For younger unemployed workers aged 16–24 the government proposes, in its Kickstart programme, that funding will be made available for six month placements which will cover 100% of the relevant National Minimum Wage for 25 hours a week, plus the associated employer National Insurance contributions and employer minimum automatic enrolment contributions.

The government has also announced that it will provide an additional £111 million this year for traineeships in England, to fund high quality work placements and training for 16–24 year olds. The government will fund employers who provide trainees with work experience, at a rate of £1,000 per trainee. The government will expand eligibility for traineeships to those with Level 3 qualifications and below, to increase access to the scheme.

Payments for employers who hire new apprentices – The government will introduce a new payment of £2,000 to employers in England for each new apprentice they hire aged under 25, and a £1,500 payment for each new apprentice they hire aged 25 and over, from 1 August 2020 to 31 January 2021. These payments will be in addition to the existing £1,000 payment the government already provides for new 16–18-year-old apprentices, and those aged under 25 with an Education, Health and Care Plan – where that applies.

The government is also proposing to provide £101 million for the 2020–21 academic year to give all 18–19 year olds in England the opportunity to study targeted high value Level 2 and 3 courses when there are not employment opportunities available to them.

Other steps

The government is also proposing investment in Department for Work and Pensions (DWP) Jobcentres to assist jobseekers of all ages but with targeted assistance for younger unemployed.  In addition the Stamp Duty freeze and Green Homes Grants and government infrastructure spending are hoped to boost the housing and building sectors. The lowering of VAT (to 5%) in the food and entertainment sectors between 15 July 2020 and 12 January 2021 and the August “Eat out to help out” scheme have been suggested to support businesses and jobs in the hospitality sector and entertainment sectors.

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