The Government have announced further changes to the furlough scheme. The precise detail has not yet been released and further guidance is anticipated on 12 June.

As ever, the devil is in the detail, but the key changes are as follows:

The furlough scheme will close to new entrants from 30 June. From this point onwards, employers will only be able to furlough employees that they have furloughed for a full 3 week period prior to 30 June.  Therefore, the last date for furloughing anyone who has not previously been furloughed is 10 June, in order for the current 3 week furlough period to be completed by 30 June.

From 1 July, furlough leave will become flexible. Employers shall be able to bring staff back on a part time basis whilst keeping them on furlough leave for the remainder. Employers will be required to pay staff for the days they work and claim on the furlough scheme for the other days. It is down to the individual employer how much work they provide, as some will have more work available than others. This arrangement has been brought in a month earlier than originally planned. It allows flexibility in getting employees back to work where work is available. However, when claiming the CJRS grant for furloughed hours; employers will need to report and claim for a minimum period of a week.  During this time the Government will continue to contribute up to 80% of pay, subject to a cap of £2,500.

From August, the furlough scheme will be tapered down. The Government will continue to contribute up to 80% of salary up to the cap of £2,500 but the employer will be required to pay national insurance contributions and pension contributions.

From September, the Government contribution for those on furlough will reduce from 80% to 70% subject to a cap of £2,190.  The employer will be required to pay 10% so that the total amounts to 80% of pay. In addition, the employer will have to pay national insurance contributions and pension contributions.

From October, the Government reimbursement level will be limited to 60% subject to a cap of £1,875. The employer will contribute 20% (again making it up to 80% of normal pay), along with national insurance contributions and pension contributions.

The self-employed grant is also being extended, with applications opening in August for a second and final grant.  The intention is to provide parity with the reducing furlough scheme, paying 70% (not 80%) of average earnings up to £6,750.

If you would like any further information, please contact Angela Gorton on 0113 280 2026 or or another member of the employment law team.

If you are worried your business has made mistakes in the uptake and implementation of the coronavirus job retention scheme (CJRS) or are facing a potential Furlough Fraud investigation by HMRC, our team of specialist Furlough Fraud Solicitors can offer you tailored legal advice and specialist representation.

Please note this information is provided by way of example and may not be complete and is certainly not intended to constitute legal advice. You should take bespoke advice for your circumstances.

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