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Wales Online
Wales Online
National
Fionnula Hainey & Brett Gibbons

Furlough scheme will change in coming weeks with new rules on payments

Changes to the government's coronavirus job retention scheme will come into effect for employers in the coming weeks.

The furlough scheme, whereby the government has funded the wages of millions of workers throughout the Covid-19 pandemic, will cease on October 31.

Until then, there will be changes to the amount employers must contribute to the pay of furloughed workers at the start of each month, reports the Manchester Evening News.

Little will change for furloughed employees, who are still entitled to the same amount of money, but employers will be required to start contributing more each month until the scheme closes.

However, from the start of this month, firms have been allowed to bring back furloughed staff for any amount of time and any shift pattern, while still benefiting from the scheme.

Wage caps are proportional to the hours an employee is furloughed.

That means that if an employee is placed on furlough for 60 per cent of their usual hours, they are entitled to 60 per cent of the £2,500 cap.

Thousands of worker are on furlough while businesses remain closed during the pandemic (Yui Mok/PA Wire)

But from August 1, employers will need to start paying National Insurance and pension contributions for the hours the employee is on furlough.

The government will still pay 80 per cent of wages up to a cap of £2,500 for the hours an employee is on furlough and employers can also continue to top up employee wages if they wish.

From September 1, employers will start contributing towards wage payments - with a 10 per cent contribution in September and a 20 per cent contribution in October.

Earlier this month, chancellor Rishi Sunak announced that firms that bring back furloughed workers will be awarded £1,000 per employee as part of a jobs retention scheme bonus.

The measure is part of an emergency package of support to help keep people in work following the coronavirus pandemic.

The latest figures show that at least 9.3 million people in the UK have been furloughed since the start of the crisis.

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