The Coronavirus Job Retention Bonus: What is it & Who Can Claim?
14th October 2020
This year has been extremely tough on businesses, employers and employees. Thankfully, there have been a few grants and schemes which have made life a bit easier.
The trouble is, figuring out what each one is and who can claim. Below we will go into Coronavirus Job Retention Scheme (Job Retention) Bonus (“CJRS(JR)B”).
What is the CJRS (JR) Bonus?
The CJRS (Job Retention) Bonus is a £1,000 one-off taxable payment to the employer for each eligible employee that you furloughed and kept continuously employed until 31st January 2021.
The bonus will be claimable between 15th February 2021 and 31st March 2021. The Job Retention Bonus is for employers with employees who have been on furlough at some point, and remain employed, and not under notice, on 31st January 2021. This money does not have to be paid to your employee.
How does an employer qualify for the CJRS (JR) Bonus?
For an employer to be eligible to receive the bonus, they must have paid a salary of at least £1, 560 to the employee between 6th November 2020 and the 5th February 2021. This caveat is to prevent employers from taking advantage of zero-hours contract workers who have only received an inconsequential amount during this period.
The new guidance states in the eligibility criteria that it requires employees to have been continuously employed from the end of the claim period of the last CJRS claim. Therefore, the bonus will be payable for employees who had returned to work before the original announcement was made, as long as they had been furloughed at some point and that they meet the minimum income threshold requirement.
You can read a simpler guide on the CJRS (JR) bonus scheme over on the government’s website, including how to figure out whether as an employer you are eligible.
The claim for the bonus will need to be done within a 6-week window, between the 15th February 2021 and the 31st March 2021. The Treasury Direction has not yet released specifics on how the claim is to be made, but further guidance and details will be released in due course.
What are the consequences of this bonus for employers and businesses?
A key question is: will this bonus mean employers will reconsider redundancies? Whether this is the case is unknown, but it may certainly improve the case for retaining those at risk employees. On the other hand, it may only really benefit those employers who were already planning to bring back and retain their staff.
The sectors in which it will have the most impact will be retail, leisure and hospitality, where it could just about tip the balance towards keeping staff on. Unfortunately, for those employers who have already discussed and decided that redundancies are going to be the only way to go forward, then it will unlikely be enough to make them reconsider.
How does the bonus make you feel as an employer? Has it been enough for you to reconsider redundancies? You can get in touch with us here at Purple HR, if you would like to discuss your options further.
Will the bonus scheme impact ongoing redundancy programmes?
If you are already in the middle of consultations over redundancies, you should include the announcement of the bonus and the job support scheme on any agendas for part of your consultations. If this new scheme can help to avoid, delay or alleviate the redundancies that you need to make, then it is important to discuss it fairly before making any decisions.
This scheme may be used with the new Job Support Scheme (if you are eligible), or with temporary pay/reduced hours. This may help you to decide whether to start bringing employees back on reduced pay or hours, even if the bonus scheme alone is not enough.
Do you have employees who can’t come back to work?
You may have some furloughed employees who aren’t able to return to work or were unwilling to when the furlough scheme ended this month. This could be due to health concerns; travel worries or ongoing childcare disruptions. No matter what the reason, as an employer, you should consider the options you have, such as unpaid leave.
However, the bonus would not be payable for those employees who do not return, unless they remain employed until 31st January 2020 and are paid at least £1,560 between the 6th November 2020 and the 5th February 2021.
If you would like to discuss the Coronavirus Job Retention Scheme (Job Retention) Bonus, such as your options and whether you would be eligible, get in touch with Purple HR today.