Furlough Update — Final Round of Changes to the Current Scheme

Further to the regular updates made to the furlough scheme on a monthly basis in recent months, this is a reminder of the final set of changes that came into effect from 1st August 2021, and should be considered when preparing August payrolls. This is the final set of changes prior to the scheme ending on 30th September 2021.
  • Companies can only claim 60% of wages for furloughed employees under the Scheme
  • The Furlough claim cap is reduced to £1,875 per month
  • Furloughed employees must continue to receive at least 80% of their wages (up to £2,500 total) for the time they are furloughed meaning the employing company must pay the difference between that and what is claimable for the furloughed employees
  • Final furlough claim amendments must be made by 28th October 2021

With the additional 20% cost borne by the employing company it is advisable to create a 20% Compulsory Top-Up element within the payroll if you haven’t already done so along with a 60% Furlough component. Otherwise, all previous conditions of the furlough continue to apply, and employing companies are free to continue topping-up beyond the 80% minimum for furloughed employees at their own expense.

Please check with your payroll provider on latest guidance, including setting-up for additional components and where to record furlough details — if running your own payroll please consult the software providers in the first instance.