Coronavirus Job Retention Scheme (CJRS) cut-off date extended to 19 March 2020

The Government has announced that the cut-off date for the Coronavirus Job Retention Scheme (CJRS) has been extended from 28 February 2020 to 19 March 2020, potentially enabling employers to furlough employees taken on during that period.

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.

The updated guidance published on Wednesday 15 April 2020 states that to be eligible for the scheme, an employee must have been on the employer’s PAYE payroll on or before 19 March 2020 and HM Revenue & Customs (HMRC) must have been notified of a payment through Real Time Information (RTI) by that date.

The Treasury says that it expects the extension of the cut-off date to benefit more than 200,000 employees, who employers would otherwise have been unable to furlough.

The new guidance also changes the arrangements for employees made redundant or who left their employment voluntarily in recent months. The guidance now states that anyone on an employer’s payroll on 28 February 2020 and notified to HMRC on an RTI submission on or before that date who stopped working for their employer prior to 19 March 2020 can be re-employed and furloughed.

At the same time, the Treasury has issued a Direction, giving instructions to HMRC for making payments under the CJRS.

Crucially, the direction confirms that the scheme applies to anyone who is furloughed “by reason of circumstances as a result of Coronavirus disease.”

The Direction also provides an exemption for company directors who are also furloughed employees to carry out duties “relating to the filing of company accounts or provision of other information relating to the administration of the director’s company…”

At the same time, it confirms that there must be a written agreement between the employer and the furloughed employee “that the employee will cease all work in relation to their employment”.

HMRC has confirmed that it expects the scheme to come into effect next week.