CJRS update: Employer contributions to rise

Changes to the Coronavirus Job Retention Scheme (CJRS) will come into effect in September as the business support programme heads towards its end of October closing date.

From September 1, the government will pay 70 per cent of wages up to a cap of £2,187.50 for the hours the employee is on furlough.

Employers will pay NI and pension contributions and top up employees’ wages to ensure they receive 80 per cent of their wages, up to a cap of £2,500, for time they are furloughed.

More changes will take place in October. From the beginning of that month the government will pay 60 per cent of wages up to a cap of £1,875 for the hours the employee is on furlough.

Employers will still pay NI and pension contributions and top up their employees’ wages to ensure they receive 80 per cent – up to a cap of £2,500, for time they are furloughed.

They will still be able to choose to top up employee wages above the 80 per cent mark at their own expense.

The CJRS, one of the key planks of the government’s response to the economic challenges facing businesses as a result of the Covid-19 pandemic, was introduced in March. It will come to an end on October 31.

It is still supporting 9.6 million people and it has been reported that it will have cost the Treasury more than £34bn.

At the beginning of the scheme the government payed 80 per cent of a furloughed employee’s wages, up to at £2,500 monthly limit, as well as employer NI and pension contributions.