New Job Retention Scheme Rules From 1st July

New Job Retention Scheme Rules From 1st July

Following the Government’s announcement two weeks ago that the furlough scheme will be extended after the current scheme ends on 30th June, here are the main changes they have made in the creation of the new scheme:-

Grants – the compensation paid under the scheme will now be tapered out, and by reminder the key dates and changes are:

  • 1st August you will meet the employers nic and employers pension contributions.
  • 1st September you will also meet 10% of the minimum 80% minimum gross wages payment. 
  • 1st October you will meet a further 10% (20% in total) of the 80% minimum gross wages payment. 

Straddling – The new scheme which permits flexible working starts 1st July, so periods that straddle the 30th June have to be split into two separate claims; one up to 30th June, and a new one from 1st July. i.e you have to make 2 claims for one furlough period. 

Deadlines – Claims under the existing scheme must be made on or before 31st July, and claims under the new scheme cannot be made until 1st July.  You must claim for your June claims before any July scheme claims.

Pre-pay-day claims – Under both the new and old scheme, the existing rule of not being able to make a claim more than 14 days before the end of the claim period will continue.  By example if you are due to pay your team on 31st July, you cannot submit your furlough claim any earlier than the 18th July. 

Claims per period – Again as a continuation of the old scheme, only one claim per PAYE scheme, per period is permitted, which must include all pay frequencies. For example, if you pay monthly and weekly wages, the monthly claim from 1st July to 31st July (the maximum of the two types) must include the weekly wages (within the same period) all one claim.   However if you only pay weekly wages, you could make consecutive weekly claims.

Monthly claims –  Must start and end within the same calendar month because from now on the rules change at the beginning of each month until 1st October.

Minimum claim period – Is now one week, unless of course you are dealing with a month end straddle claim.  So if you were claiming for one week between 27th August and 2nd September, you are permitted to make a five day and two day claim. 

Qualifying employees –

  • Must have previously been a furloughed employee at any point between the commencement of the scheme on 1st March and 30th June (for the three week minimum).  
  • New furloughs claim periods commencing after 11th June and before 30th June (for example a furlough claim made on 12th June, and a new period started on 13th June) remain under the existing minimum of 3 weeks furlough period.  Hence these will straddle 1st July, and require splitting into two claims, one to 30th June, and a second from 1st July. However the element in July cannot use the flexi furlough as the period started under the old rules.
  • The maximum number of employees on the new scheme cannot exceed the maximum number of employees you furloughed on the old scheme, unless:-
    • The employee is returning from maternity or paternity leave after 10th June, or
    • The employees have been transferred into your scheme under TUPE, and were subject to the minimum furlough period before the 30th June under their prior employer’s PAYE scheme


  • For the obvious reason that part-time work is permitted, there is no minimum furlough (the three weeks under the old scheme), not even one day.  
  • Simply prepare your claims as:-
    • Usual hours (contracted hours on or before 19th March)
    • Less hours worked
    • = Furloughed hours
    • Unfortunately a spreadsheet upload of furloughed employee information continues to only available where the claim contains at least 100 employees. 

Payslip details – Since 2019, hours worked have appeared on payslips by law, and this will continue under the new schemes.  Under the scheme “worked hours” will be less than hours paid, and therefore you may show the furloughed hours if you wish to equate to the total hours paid. 

Wages cap – The process of apportioning the maximum £2500 pcm to match the furloughed days continues. Eg if you were furloughed for 18 days in July, the maximum claim is £1451.61 (18/31 x £2500).


The rules are clearly horribly complicated with a high risk of error, and HMRC have introduced penalties of between 30% to 100% of the errors depending on how the errors are discovered.  The important thing is to keep detailed records of your calculations and claims (for 6 years).  If you make a mistake and spot it:

  • For over-claims in prior periods you must correct that in your current claim and tick the box to say a correction has been made.  
  • For under-claims, you must contact HMRC on 080 0024 12222. 

Working examples:-

How to calculate usual hours, 80% of pay and NIC/pension grants

How to calculate claims under flexi furlough

Find more information in our Covid-19 Support section.