HM Revenue & Customs (HMRC) has published a series of updates to its guidance on the Coronavirus Job Retention Scheme (CJRS), more commonly known as the ‘furlough scheme’.

The updates cover the changes to the scheme as it is extended from 1 May 2021 to 30 September 2021.

The guidance confirms that new employees who have not previously been eligible for furlough can be furloughed for the first time from 1 May 2021 onwards as long as they were included in a Full Payment Submission to HMRC by 2 March 2021.

As with the existing scheme, furloughed employees will continue to receive 80 per cent of their usual wages capped at £2,500 a month, or equivalent weekly or daily figures, for usual hours not worked under the extended scheme.

CJRS grants will continue to cover the full 80 per cent paid to employees in May and June, while employers must continue to cover the costs of the associated Employer National Insurance and workplace pension contributions. However, employers will also need to make a 10 per cent contribution in July and a 20 per cent contribution in August and September to the amount paid to employees.

The calculation of usual wages is based on the last pay period before the employee became eligible for furlough. Those dates vary, depending on whether the employee was reported to HMRC on or before 19 March 2020, 30 October 2020 or 2 March 2021. Any pay rises since an employee’s reference date are not taken into account for any time they are furloughed.

The new guidance also clarifies and changes several technical points relating to the calculation of furlough pay in various circumstances that employers will need to be aware of.

Full guidance for the CJRS is available here.