The Job Retention Scheme is an unprecedented temporary government initiative designed to support employers financially, and to maintain job security and a certain level of income for staff whose jobs may otherwise be affected by the pandemic.

What does "furloughing" staff mean?

It means temporarily laying off staff for a period of time whilst keeping them on the payroll and continuing to pay them at an agreed rate which may be reimbursed by the government.

What financial support is provided under the scheme?

The Government will provide a grant to cover the lower of 80 per cent of an employee's regular wage or £2,500 per month, plus the associated employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that subsidised wage. Fees, commission and bonuses should not be included.

The scheme will be backdated to March 1, 2020 and will be in place for an initial three-month period.

Which employers can access the scheme?

All UK employers who had created and started a PAYE payroll scheme on February 28, 2020 can "apply" to use the scheme.

Which categories of staff can benefit from the scheme?

The scheme is open to employees on the PAYE payroll at February 28, 2020 and on any type of contract. It also covers employees who were made redundant since February 28, 2020, if they are rehired by their employer.

Does the scheme apply to self-employed contractors or freelancers?

No, but self-employed individuals may be eligible to claim Universal Credit or government self-employed income support.

How will the Government pay staff salaries under the scheme?

As the employer, you will still be required to pay staff salaries under the scheme. You can then make a claim for wage costs through the scheme and if you are eligible, the Government will reimburse costs, subject to the limits set out above.

For more details on the Job Retention Scheme and coronavirus legal implications, please visit vwv.co.uk/news-and-events/news/coronavirus.

  • Rebecca Fox is a senior associate at award-winning law firm VWV, which has offices in Clarendon Road, Watford