Job retention bonus: will it tip the balance?

This month, the government has confirmed the details of the coronavirus job retention bonus (JRB) scheme.  The mathematics may cause some headaches and employers will be thinking carefully whether it is worth the time and effort to retain employees in order to make claims under this scheme.

Employers who choose to claim a JRB will receive a single payment of £1,000 for each employee who:

• Was furloughed and validly claimed for under the job retention scheme;
• Earned at least £520 per month on average between 1 November 2020 and 31 January 2021; and
• Was in continuous employment until at least 31 January 2021

However, employers cannot claim the JRB where they have repaid the full job retention scheme grant to HMRC for any reason.

Where there has been a TUPE transfer, a claim for a JRB payment can only be made if the transfer took place before 31 October 2020 and the new employer furloughed the employee and made a valid claim under the Job Retention scheme.

As the furlough scheme ends this month, employers can use the less generous job support scheme and still claim a JRB payment.

As expected, employers will not be able to claim a JRB payment for employees who are under notice of termination of employment on 31 January 2021, whether that notice is statutory or contractual.

Employers will need to weigh this up when considering whether the £1000 JRB payment offsets the cost of retaining an employee until at least February 2021 in a role which is not currently paying its own way due to the impact of COVID-19 on the UK economy.

If you need help working through the options, or are considering redundancies or other alternatives, contact our specialist team.Disclaimer
This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full General Notices on our website.