Employer and employee eligibility for the extended CJRS

05 November 2020

Following on from announcements made relating to the extension to the Coronavirus Job Retention Scheme (CJRS), a policy paper has been published, which is applicable to claims for the periods between November 2020 and the end of January 2021.

Extended guidance is due to be released on 10 November 2020, and details relating to how the scheme will work from February 2021 – March 2021 will be provided following the Government’s review of the scheme.

Businesses will want to start assessing if they, and their workers, are eligible for the scheme, and the policy paper provides extensive detail in that area.

Employer eligibility

There is no requirement for employers to have accessed the CJRS previously in order for them to claim under the extended scheme, and businesses across the UK are able to claim, regardless of whether they are open or closed.

The expectation is that publicly funded organisations will not utilise the scheme, as previously with the CJRS, but partially publicly funded organisations could be eligible in scenarios where private revenue has been disturbed. All other CJRS eligibility criteria must be met in order for companies to use the scheme.

HMRC intends to publish the details of any employers making claims under the extended CJRS, from December 2020 onwards. Further details will be provided on 10 November, when full guidance is issued.

Employee eligibility

Employers may claim for any employees who were employed, and on PAYE payroll on 30 October 2020. A PAYE Real Time Information (RTI) submission must have been made to HMRC notifying payment of earnings for that employee between 20 March 2020 and 30 October 2020.

Employees can be placed on any shift pattern and be furloughed either on a full or part-time basis, with the option to vary the hours worked, as long as this is agreed between employer and employee. Employers will have the option to use the scheme for employees for any amount of time.

Employees can also be on any type of employment contract.

If employees have been furloughed previously, then the same calculations for obtaining reference pay and usual hours must be used as under the initial version of the CJRS.

For an employee who meets the criteria of the extended scheme, but who hasn’t previously been eligible for CJRS then the alternative calculations of reference pay and usual hours have to be used. For any other employees, employers have to utilise the CJRS calculations for calculating reference pay and usual hours.

Employers can claim for the same level of grant from the Government as observed under the scheme for August 2020, so for any hours not worked, employers will only be required to pay for employer National Insurance (NI) and pension contributions. This will be reviewed in January, and the level of support could change from February 2021. If employees work any hours as normal then the employer must pay them for that, plus the associated on-costs.

Employees can be furloughed if they are unable to work because they:

  • Are shielding, and following public health guidance, or are required to stay at home with somebody else who is shielding
  • Have caring responsibilities resulting from coronavirus – this extends to employees required to look after children

The scheme is not intended for short-term sickness absences, but if employers wish to furlough employees who are currently off sick for business reasons, then they are able to do so.

Any furloughed employees who become ill, coronavirus-related or not, must be paid at least the level of Statutory Sick Pay (SSP). It is the employer’s decision as to whether employees are placed onto SSP or kept on furlough.

Employees that were employed and on payroll as of 23 September 2020, who were made redundant or stopped working for their employer afterwards, can be re-employed and claimed for, but the employer must have made a PAYE RTI submission between 20 March 2020 and 23 September 2020, which included those employees. If an employee who was on a fixed term contract, and on payroll on 23 September 2020, had a contract that expired after that point, then they can be re-employed and claimed for, on the proviso that other eligibility criteria are met.

As under the original CJRS, employees are not permitted to complete any work for their employer that makes money or provides services for their employer, for hours that they are recorded as being on furlough. This extends to any organisation linked or associated with the employer. Employees are, however, free to participate in training, to volunteer for another organisation or to work for another employer, if their contract permits.

Employees retain their rights at work, including their right to SSP, annual leave, maternity and other parental rights, rights against unfair dismissal, redundancy payments and they are entitled to be paid at least the statutory National Minimum Wage (NMW) rates for any hours that they have worked.

The Working Tax Credits working hours easement will be applicable for the duration of the extension to the CJRS, and there will be no change from the initial CJRS for employees that are on statutory parental leave.


The information in this article is accurate at the time of publication. For all the latest information, news and resources on how the COVID-19 pandemic is affecting payroll professions, visit our Coronavirus hub.