Scrase Law Employment Solicitors

Coronavirus Job Retention Bonus – guidance published

On 8 July 2020, the Chancellor Rishi Sunak announced the Government’s Plan for Jobs 2020.  As part of that plan, Mr Sunak introduced a new Job Retention Bonus that will be payable in some circumstances to employers that bring employees back from furlough. 

Mr Sunak stated that “Furlough has been a lifeline for millions, supporting people and businesses to protect jobs.  But it cannot and should not go on forever.  I know that when furlough ends it will be a difficult moment.  But while we can’t protect every job, one of the most important things we can do to prevent unemployment…is to get as many people as possible from furlough back to their jobs.” 

According to the announcement, the maximum possible cost of the bonus (if paid to all 9.4 million jobs furloughed at any point during the scheme, for claims received by 5 July) is £9.4 billion.

Further details about the Job Retention Bonus (JRB) have now been published. 

What are the key points?

  • The JRB will be a one-off payment of £1,000 to UK employers for every furloughed employee who they previously claimed for under the Coronavirus Job Retention Scheme (CJRS) and who remains continuously employed through to the end of January 2021.
  • The aim of the bonus is to reward and incentivise employers who successfully bring furloughed staff back.
  • Employees must earn above the Lower Earnings Limit (£520 per month) on average between 1 November 2020 and 31 January 2021.
  • Payments will be made from February 2021.

Which employers can claim the JRB?

All employers are eligible for the scheme.  However, where a claim under the CJRS for an employee was incorrectly made, the JRB will not be payable.  HMRC will withhold payment of the JRB where it believes there is a risk that CJRS claims may have been fraudulently claimed or inflated, until the enquiry is completed.

Which employees can an employer claim the JRB for?

Employees that were eligible for the CJRS, were furloughed and had a CJRS claim submitted for them that meets all eligibility criteria for the scheme.  The employee must have been continuously employed until at least 31 January 2021 and have been paid an average of at least £520 a month between 1 November 2020 and 31 January 2021.  Importantly, the employee must not be serving a contractual or statutory notice period that started before 1 February 2021.

How do employers claim the JRB?

Employers will be able to claim the JRB from February 2021.  More detail about the process will be published by the end of September 2020.

Comment

The aim of the JRB is to preserve jobs.  However, it remains to be seen whether this initiative will serve as an incentive to preserve jobs in the way that Mr Sunak believes.  In the meantime, the policy has been criticised for not being sufficiently targeted on those employers who need it the most.  It has been reported that a number of High Street employers, including Primark and John Lewis, have confirmed that they will not be claiming the Bonus.

Originally posted 17 July 2020. Updated 3 August 2020.

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©2020 SCRASE LAW LTD. THIS POST IS FOR GENERAL INFORMATION ONLY AND IS NOT ADVICE. YOU ARE RECOMMENDED TO SEEK COMPETENT PROFESSIONAL ADVICE BEFORE TAKING ANY ACTION ON THE BASIS OF THIS POST