The details of the changes to the Coronavirus Job Retention Scheme have been announced, including the below changes regarding workplace pensions:
Employer contributions for furloughed workers
Furlough pay will remain capped at 80% of salary or wages up to £2,500.
Currently, grants under the Government’s Job Retention Scheme cover costs relating to employment, of up to £2,805 per employee. This includes the 80% of wages up to £2,500 per month, as well as employer’s National Insurance and the minimum 3% employer workplace pension contribution on their qualifying earnings. See more details here.
From August, employers will be required to pay for the employer’s National Insurance and the employer’s workplace pension contributions. The minimum 3% employer workplace pension contributions on qualifying earnings costs will not be covered by the Job Retention Scheme.
In September, the government will pay 70% of the wages reducing to 60% in October. Employers will pay the employer’s NICs and workplace pension contributions and top up employees’ wages to ensure they receive 80% of their wages up to a cap of £2,500 whilst they are furloughed.
|Wages||Auto-enrolment minimum employer contributions||Employer National Insurance|
|July 2020||Government – 80%||Government||Government|
|August 2020||Government – 80%||Employer||Employer|
|September 2020||Government – 70%||Employer||Employer|
|October 2020||Government – 60%||Employer||Employer|
While existing furloughs can continue, employers will not be able to furlough or re-furlough workers after the 10th June.
From July, employers will have the option to bring back employees from furlough on a part-time basis while still being able to claim under the Coronavirus Job Retention Scheme. Employers will have to pay 100% of wages for the hours worked.
Auto-enrolment pensions and Salary Exchange are set up and taken care of for you.
Workplace pension admin is complex
Make sure you are compliant with the Auto-Enrolment regulation during these complicated times. Husky’s cloud-based workplace pension platform eliminates the complexity, time, risk and cost associated with managing workplace pensions.
Contact us on 0800 044 8114 or email email@example.com to learn about how we can support you during this unusual, evolving period.