The furlough scheme ends this month

Last updated 1st October

 As you probably know, the furlough scheme ends at the end of this month. So what does it look like for this final month – and what happens after then?

What’s happening to the furlough scheme in October?

If you’re on furlough, this month your employer will have to increase the amount they contribute to your salary. The government will pay 60% of your salary, up to a maximum of £1,875; and your employer will have to top up the rest, to at least £2,500 or 80% of your total salary, whichever is lower.

As is the case now, your employer will have the option to top up your pay to 100% if they are able to do so.

This means you should continue to be paid the same as you have during the furlough scheme so far. So in theory, the changes to furlough shouldn’t affect you.

However, if your employer finds it financially difficult to pay some or all of your salary, your job could be at risk. If you’re concerned that you might be made laid off, have a look at our blog about redundancy. One bit of good news is that the government has now brought in a new law to ensure that statutory redundancy pay has to be based on your full wage, not the lower rate of furlough pay.

 

What support will be available once the furlough scheme ends?

The Job Support Scheme will start on the 1st of November and run for six months.

Under this scheme, if you’re able to return to work part-time, the government may top up some of your wages.

Employers will continue to pay the wages of staff for the hours they work – but for the hours not worked, the government and the employer will each pay one third of their equivalent salary. So if you’re working 33% of your usual hours, you should receive 77% of your usual pay – up to a cap.

The Government hasn’t yet said when employers will have to apply to take part, or how much notice employees must be given – we’ll share more details when we have them. In the meantime, here are some things you need to know:

• To be eligible, employees must be working at least 33% of their usual hours, and have been on the payroll since on or before the 23rd September 2020.
• The level of top up grant from the government will be calculated based on the employee’s usual salary, capped at £697.92 per month.
• Although the scheme is designed to replace the furlough scheme, businesses can be eligible whether or not they furloughed employees.
• All small and medium-sized businesses are eligible. Larger businesses can take part, but they must prove they’ve been adversely affected by coronavirus, and can’t pay dividends to their shareholders while using the scheme.

What if I’m not eligible for the Job Support scheme?

• Use our free, independent benefit checker to see if you can claim any additional support.
• If you’ve been made redundant, take a look at our redundancy guide.
• If you’re one of our customers on a Debt Management Plan, IVA, Trust Deed or DAS, let us know as soon as your financial situation changes, so we can make sure you’re not paying more than you can afford into your debt solution. You can find details on how to contact us here.

 

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