Flexible furlough rules set out in new Treasury Direction

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The latest Treasury Direction on the Coronavirus Job Retention Scheme (CJRS) establishes the rules that will apply from 1 July 2020 and introduces ‘flexible furlough’ arrangements that will continue until the closure of the scheme on 31 October 2020. In doing so, it alters the effect of those previous Directions issued on 15 April and 20 May.

The new Direction confirms 31 July as the deadline for making claims under the terms of the original CJRS, which were defined in the previous Directions and in force until 30 June. Employers can only make applications under the amended CJRS from 1 July if they have previously claimed under the original scheme by 31 July for employees who were furloughed for a minimum period of three weeks on or prior to 10 June. Employees who are returning from family leave or who are armed forces reservists are exempt from the 10 June deadline.

Under the new Direction, employers must continue to make a written agreement with employees regarding their flexible furlough arrangements and a copy of this should be retained by the employer until at least 30 June 2025.

In relation to flexible furlough, the Direction provides extensive details of how to calculate the amounts payable by the employer and those that can be claimed under the CJRS.

Now is therefore the time to be assessing your staffing needs with effect from 1 July and whether you want to use the freedom under these new rules for previously furloughed staff to phase-back their return to work.

If you have any questions about the application of these new rules or any other employment issues then please do not hesitate to contact the team.