Further details of Job Retention Bonus unveiled

Following the Chancellor’s announcement on 8 July of a Job Retention Bonus, the Government unveiled further details of the scheme on Friday.

Purpose of the scheme

The Job Retention Bonus will provide further support to employers who “keep on their furloughed employees in meaningful employment”, after the Government’s Coronavirus Job Retention Scheme (CJRS) ends on 31 October 2020.

Under the Bonus, the Government will make a one-off payment to employers of £1,000 for every employee who they previously claimed for under the scheme, and who remains continuously employed through to 31 January 2021.

It is anticipated that the bonus will help to support employment rates through the UK’s economic recovery from coronavirus by encouraging and helping employers to retain as many previously furloughed employees as possible.

Which employers can access the Bonus?

HMRC states that an employer will be able to claim the Job Retention Bonus for any employees that were eligible for the CJRS and that they have claimed a grant for.

Which employees can an eligible employer claim the Bonus for?

Employers will be able to claim for employees who:

• Were furloughed and had a CJRS claim submitted for them that meets all relevant eligibility criteria for the scheme. However, where a claim for an employee was incorrectly made, a Job Retention Bonus will not be payable
• Have been continuously employed by the relevant employer from the time of the employer’s most recent claim for that employee until at least 31 January 2021
• Have been paid an average of at least £520 a month between 1 November 2020 and 31 January 2021 (a total of at least £1,560 across the three months). The employee does not have to be paid £520 in each month, but must have received some earnings in each of the three calendar months that have been paid and reported to HMRC via RTI;
• Have up-to-date RTI records for the period to the end of January
• Are not serving a contractual or statutory notice period, that started before 1 February 2021, for the employer making a claim

Employers can claim the bonus for all employees who meet the above criteria, including office holders, company directors and agency workers, including those employed by umbrella companies. The above criteria must be met regardless of the frequency of the employee’s pay periods, their hours worked and rate of pay.

Employers will be able to claim the bonus after they have filed PAYE for January and payments will be made to employers from February 2021.

Employer requirements

To access the Bonus, employers should ensure that they have:

• Complied with their obligations to pay and file PAYE accurately and on time under the Real Time Information (RTI) reporting system for all employees
• Maintained enrolment for PAYE online
• A UK bank account

Employers must keep their payroll up to date and accurate and address all requests from HMRC to provide missing employee data in respect of historic Coronavirus Job Retention Scheme claims. Failure to maintain accurate records may jeopardise an employer’s claim.

HMRC will withhold payment of the Job Retention Bonus where it believes there is a risk that Coronavirus Job Retention Scheme claims may have been fraudulently claimed or inflated, until the enquiry is completed.

Next steps

Employers will be able to claim the bonus from February 2021 after they have filed PAYE for January and payments will be made to employers from February 2021. Further information about the process will be published in guidance by the end of September 2020.

We will let you know as soon as the guidance is published but for any advice in the meantime get in touch.