The government has extended the furlough scheme meaning workers can get 80% of their salary paid through lockdown.
The scheme was due to end yesterday, but will now run throughout November as Boris Johnson announced that England is moving into a second lockdown period.
⚠️ Read our coronavirus live blog for the latest news & updates
Chancellor Rishi Sunak said: “As restrictions get tougher, we are taking steps to provide further financial support to protect jobs and businesses. These changes will provide a vital safety net for people across the UK.”
Here’s everything you need to know about the extended furlough rules.
How much money will I get if I have been furloughed.
The Job Retention Scheme will pay furloughed employees 80% of their current salary for hours not worked, up to a maximum of £2,500.
You’ll also get your usual full salary for any hours you do work during the lockdown period.
Over the past few months, the government had been reducing the amount it was paying for furlough so that businesses had to cover a bigger percentage of staff wages.
But under the extended scheme, the cost for employers of keeping workers on furlough will be reduced.
Businesses will only be asked to cover National Insurance and employer pension contributions which, for the average claim, accounts for just 5% of total employment costs.
Employers are still able to choose to top up employee wages above the scheme grant at their own expense – but they don’t have to.
The government has said that it will take a few days for the scheme to be fully up and running, but there should be no interruption for staff pay, and businesses will be able to claim the money back in arrears.
Who is eligible for furlough?
To be eligible for furlough, you need to have been on your employer’s payroll by 23:59, October 30 2020.
Employees can be on any type of contract, meaning you could still be furloughed if you are part-time or a contract worker.
You don’t need to have been furloughed before to be eligible for the scheme, and the business you work for doesn’t need to have furloughed anyone before to do it now.
All employers with a UK bank account and UK PAYE schemes can claim the grant.
How long can I be furloughed for?
The rules say that employers must claim for a minimum for seven consecutive days.
But businesses are allowed to offer part-time arrangements, so it is possible that your income could be a mix of furlough and normal employment.
Your furlough arrangements are up to your employer, and HMRC says it employers will be able to agree type of working arrangements with their staff.
The scheme is expected to come to an end when lockdown ends on December 5.
But Michael Gove has warned that lockdown could be extended, which could mean the furlough scheme is kept open too.
When furlough does come to an end, the government is planning to introduce its Job Support Scheme to try and help keep people in work.
What to do if you have problems claiming Universal Credit
IF you’re experiencing trouble applying for your Universal Credit, or the payments just don’t cover costs, here are your options:
- Apply for an advance – Claimants are able to get some cash within five days rather than waiting weeks for their first payment. But it’s a loan which means the repayments will be automatically deducted from your future Universal Credit payout.
- Alternative Payment Arrangements – If you’re falling behind on rent, you or your landlord may be able to apply for an APA which will get your payment sent directly to your landlord. You might also be able to change your payments to get them more frequently, or you can split the payments if you’re part of a couple.
- Budgeting Advance – You may be able to get help from the Government for emergency household costs of up to £348 if you’re single, £464 if you’re part of a couple or £812 if you have children. These are only in cases like your cooker breaking down or for help getting a job. You’ll have to repay the advance through your regular Universal Credit payments. You’ll still have to repay the loan, even if you stop claiming for Universal Credit.
- Cut your Council Tax – You might be able to get a discount on your Council Tax or be entitled to Discretionary Housing Payments if your existing ones aren’t enough to cover your rent.
- Foodbanks – If you’re really hard up and struggling to buy food and toiletries, you can find your local foodbank who will provide you with help for free. You can find your nearest one on the Trussell Trust website.
Can I still claim Universal Credit if I’m furloughed?
If you currently receive Universal Credit and you get put on furlough, you’ll continue to get it.
You don’t need to inform Universal Credit that you have been furloughed, HMRC will inform Universal Credit automatically of your reduced take home pay and your award will be adjusted automatically.
If you’re not yet claiming Universal Credit but your salary has been reduced as a result of furlough, you may be eligible for the benefit.
You can claim the benefit if you meet all of the following criteria:
- you’re on a low income or out of work
- you’re 18 or over (there are some exceptions if you’re 16 to 17)
- you’re under State Pension age (or your partner is)
- you and your partner have £16,000 or less in savings between you
- you live in the UK
Your partner’s income and savings will be taken into account, even if they are not eligible for Universal Credit.
There are other factors that might make you eligible for a claim, for instance if you care for a disabled person, you’re in further education or you’ve recently had a child.
How does furlough affect other benefits?
If you’re currently receiving other benefits, such as working tax credits, you would have seen a boost during the previous coronavirus lockdown.
If you’ve been furloughed, you may be pleased to know that there will be no change to your entitlement while the support scheme is running, according to the Low Incomes Tax Reform Group.
If you are earning less because you’ve been put on furlough, you may also see your Working Tax Credit payment rise.
Similar to Universal Credit, you don’t need to tell HMRC if you are furloughed.
Holidays abroad banned under strict new national lockdown rules.
More gloom for pubs as takeaway pints banned for 2nd lockdown.
Pubs, hairdressers, and gyms to close – full list of businesses that will shut in new national lockdown.