Pay when on furlough
Employers can use the Coronavirus Job Retention Scheme (CJRS) to claim a percentage of each employee or worker's usual wages while they're on furlough.
Staff on furlough will get 80% of their usual wages up to £2,500 per month – or more if that's been agreed with the employee or worker.
Pay during furlough is taxable in the same way as someone's usual pay would be.
Flexible furlough must last for at least 7 days in a calendar month for an employer to make a claim.
How much employers can claim
The financial support available to employers under the scheme has been reduced, but they must continue to pay furloughed employees 80% of their wages, up to a cap of £2,500 per month for the time they spend on furlough.
From 1 August to 30 September 2021:
- employers can claim 60% of wages, up to £1,875 per month
- employers need to pay 20% of wages, up to £625 per month
Employers cannot include in their claim to HMRC any:
- employer contributions to the employee or worker's pension
- employer National Insurance (NI) or tax contributions
Topping up wages to 100%
The employer should decide whether they'll top up employees' or workers' wages to 100% when they're on furlough, but they do not have to. If the employer decides not to top up the wages, they should explain why.
When someone who is on furlough takes paid holiday, they should receive holiday pay based on what they would usually earn if they were working.
Redundancy pay and notice pay
When calculating statutory redundancy pay or statutory notice pay for staff who have been on furlough, the employer must use the employee's full normal pay, not their reduced furlough rate.
Find out more about:
Minimum wage during furlough
If staff on furlough are paid 80% of their wages, this might mean they get less than the minimum wage. This is allowed as long as they're not working or doing work-related training. For example, training that makes money or provides a service for their employer or an organisation linked to their employer.
If someone does work-related training while on furlough
If someone does work-related training, the employer must pay them at least the National Minimum Wage or the National Living Wage during their pay period. In most cases, furlough pay will be sufficient for these hours. If not, the employer must top up their furlough pay.