Coronavirus Job Retention Scheme extended to end of June

The Chancellor, Rishi Sunak, has announced a further extension to the Coronavirus Job Retention Scheme (CJRS), which will see employers able to furlough employees for an additional month.

The CJRS allows employers to retain employees on the PAYE Payroll who are not carrying out work for them by placing them on furlough and to claim a grant of 80 per cent of a furloughed employee’s usual pay, plus employer National Insurance Contributions (NICS) and minimum employer auto-enrolment pension contributions.

It means that employers can retain their workforce while reducing their staffing costs, although furloughed workers cannot carry out any work for the employer.

Business groups had sounded the alarm that employers could start the ball rolling on the redundancy process if the scheme was not extended beyond the end of May, because of the requirement for consultation periods if employers expect they will have to make collective redundancies.

Employers expecting to dismiss 20 or more employees within a 90-day period must hold a 30-day consultation, while those expecting to dismiss 100 or more employees must consult for 45 days.

This means that had the CJRS ended on 31 May, employers expecting more than 100 redundancies would have needed to have started consultations on 16 April 2020 if they planned to make employees redundant at the end of their furlough period. Meanwhile, Those expecting more than 20 redundancies would have needed to begin consulting on 1 May 2020.

Statutory Residence Test changed to allow skilled workers from around the world to assist the UK’s coronavirus response

The Chancellor, Rishi Sunak, has written to the Treasury Select Committee, to inform it that the Statutory Residence Test (SRT) is being relaxed temporarily so ‘highly skilled’ individuals from around the world can join the UK’s coronavirus response without jeopardising their tax status.

The measures apply to workers such as anaesthetists and engineers working on ventilator design and production.

The move means that time spent in the UK working on the country’s coronavirus response between 1 March and 1 June 2020 will be disregarded for the purpose of the SRT. The period the relaxed measures apply to may be extended.

Without the measure, these skilled workers could have seen their global earnings becoming taxable in the UK.

Full details of the changes to the SRT are set to be included in the Finance Bill 2020.