Skip to main content

EmmaO'Connor Banner Image

Emma O'Connor


A new lockdown for England has been announced and the Job Retention Scheme (JRS#2) has been extended until 30 April 2021- Emma O’Connor, Head of Training, asks what does the new lockdown measures mean for businesses as we start 2021? 

People In Focus  Lockdown3.0 and the Job Retention Scheme  3x1

What do the new lockdown rules mean?

Much like we were told in March 2020, we must again stay at home and are only allowed to leave our homes for prescribed reasons.  Schools and colleges have closed – although are open for vulnerable children and those of key workers.  Nurseries and special schools do remain open. Vulnerable individuals are again being told to shield, with letters to be sent to those individuals affected.

Workers are to work from home unless they absolutely cannot.  Travel restrictions are also in place - only essential foreign travel, such as for work purposes, is allowed.  All non-essential shops are to close as well as leisure facilities.  Bars and restaurants must close; however, restaurants can maintain a takeaway-only service (subject to restrictions). 

Similar restrictions are in place across the devolved nations also.  

Although, the planned roll-out of vaccines has begun, with the most vulnerable (it is hoped) being vaccinated by mid-February 2021; we do not have a clear timetable or pathway as to when restrictions will be lifted. This new lockdown will undoubtedly create further uncertainties for businesses and employees.  


The latest incarnation of the JRS is designed to support employees “whose employment activities have been adversely affected by the coronavirus and coronavirus disease or the measures taken to prevent or limit its further transmission.” This has added a personal dimension to eligibility; it is not just about the business not being able to function properly because of Covid/its preventative measures, but also considers legitimate individual need and limitations on working..
The extension to the JRS – JRS#2 – has also been extended until 31 April 2021, suggesting perhaps that the Prime Minister’s optimistic estimate of mid-February as a date when restrictions might start to ease might move.  Whilst the extension of the JRS is welcomed, it again raises issues about how long jobs can be placed “on ice”. 

Key Features of JRS#2 

  • There is no maximum number of employees that an employer can claim for.
  • JRS#2 applies to all employers across the UK, whether their businesses are open or closed, including charitable organisations, although there are restrictions on public sector employers.  
  • All employers must have a UK bank account and a UK PAYE scheme. 
  • Employees must be on an employer’s PAYE payroll by 23:59 30th October 2020. Please note at the time of writing, this date has not been changed. The employer must have made a PAYE Real Time Information (RTI) submission to HMRC between the 20 March 2020 and 30 October 2020, notifying a payment of earnings for that employee. For more details for what this means for employees who have been made recently redundant, see our previous update HERE.
  • Eligible employees can also be employed on any type of employment contract, so would include employees on zero-hours contracts; the key point is that they are paid via PAYE. Note, that the self-employed would not be covered by the JRS#2 but there is separate support.
  • Neither the employer nor the employee needs to have previously used the JRS. 
  • Employers can claim 80% of employees’ salaries, up to £2,500 a month, in respect of hours not worked. Employers will still have to pay employers’ National Insurance and pension contributions. The government has confirmed that the 80% government contribution will be maintained until the scheme ends in April 2021. 
  • Employers could choose to top up furlough pay if they wish. 
  • Also, to remember that placing an employee onto furlough leave and claiming under JRS#2 is optional and not mandatory.
  • Flexible furlough is available.
  • Employers need the agreement of their employees (in writing) before furloughing or extending furlough. 
  • The rules relating to holiday/accrual and holiday pay will remain so will existing legal rights to SSP, maternity and other parental rights, rights against unfair dismissal, equality laws, redundancy payments, contractual rights and the right to be paid at least statutory National Minimum Wage for hours worked (and when training) remain also.
  • Claims under the JRS#2 remain a grant.

Key Issues for Employers 

Lockdown3.0 and the JRS create issues for employers which may impact upon decisions to access JRS#2 or on your workforce plans more generally.  

Redundancy and Notice Pay – Whilst employees can be made redundant whilst on furlough leave, JRS#2 guidance states “If you make an employee redundant, you should base statutory redundancy and statutory notice pay on their normal wage rather than the reduced furlough wage.” We knew that statutory redundancy pay had to be based on full pay but there is also clear reference to statutory notice pay too.  However, the big change is that for claim periods starting on or after 1 December 2020, employers cannot claim for any days during which a furloughed employee is serving (so working) either their contractual or statutory notice and will need to fund notice pay themselves.  This is going to have a huge impact on employers – particularly those who were minded to re-employ employees recently made redundant.  Also, if their notice period straddles a 1 December period, the employer will need to amend their claim. 

Furlough leave and childcare concerns – JRS#2 Guidance says employees can be furloughed where they are “unable to work because they have caring responsibilities resulting from coronavirus (COVID-19), including employees that need to look after children”. Although furlough has always been an option for employees impacted by school closures; there were (and are still) other considerations such as using holiday, taking unpaid leave or unpaid parental leave.  Whilst these remain, does the inclusion of a specific childcare provision make it harder to justify not using the JRS in circumstances where the employee legitimately cannot work? Does insisting the employee takes unpaid leave instead, for example, appear unfair? 
Certainly, if an employer is choosing (or not choosing) employees to furlough it must not use discriminatory criteria.  What of an employer who has work for an employee to do and declines the employee’s legitimate furlough request for childcare reasons.  Is a blanket “no furlough” policy risky? Although furlough has to be by agreement, is there a risk that this is indirect sex discrimination as a policy (or PCP) of this nature impacts potentially more women to their disadvantage than it does men because of the need for women to fulfil childcare?  Can the employer objectively justify why it will not access the furlough scheme or why it is insisting on unpaid leave instead?
It would be advisable to review the work/roles/numbers of employees potentially impacted.  What work is time critical and what is not? Can the business sustain the workforce loss for maybe 2 or 3 months (or longer)? What are the risks of saying yes/no? If the employer has lots of work, should it be accessing the JRS? Once these issues have been balanced from a business perspective, discuss with the employees what they can do and cannot.  Can work be flexed around the hours they can do? Can they remain working from home? Would maybe flexi-furlough be an option rather than complete furlough? [For HMRC audit purposes, it would be wise to ask the employee for evidence as to why they are unable to work and keep a record of this and also keep decisions under review.

Lists of Employers - Another point is that details of employers making JRS claims for December 2020 will be published in February, and then monthly thereafter.  This is presumably a fraud prevention tool but something to consider nonetheless.  The media has also been quick to criticise employers for using government schemes where they have benefitted in other ways during the pandemic, so there could be a public relations angle to claiming under the JRS.

Supporting documents and rationale – methods of calculations (for example) should be kept for 6 years. Also, keep records not just for HMRC but also in case of future challenges – why was person A selected for furlough and not person B? Decisions have to be made really quickly so a contemporaneous note of why a decision was objectively made would be advisable as memories fade.    

Engagement/reintegration/wellbeing – as well as the practicalities of ensuring working from home is safe and health and safety rules are complied with, there are other issues such as employee engagement (individual/team/community) to consider as well as employee wellbeing for those who are on furlough or who are working.  For some, employees they have been flipped from furlough to working and are now back to furlough which is having a real impact on their mental and financial wellbeing.  This will continue to be a key HR theme for 2021.

WFH Health and Safety – employers should be continuing to ensure their people can work safely from home.  Home working risk assessments should be undertaken, including using display screen equipment.  Remember too health and safety obligations as well as covid-19 requirements for those who are continuing to access their workplaces. 


As we approach the New Year with a sense of optimism, HR will be putting plans in place to support both business critical decisions but also their workforce more generally.  The lockdown and ongoing uncertainties continue to pose enormous challenges for businesses; however, there are also opportunities for HR to review what has worked and what has not, start to renegotiate the terms of “WFH contract” and look for opportunities to support managers through training or coaching.  This is a rapidly changing situation so keep the messaging clear and consistent so that the business speaks with one voice. 

Join us for our next webinar on 21 January 2021, where we will be exploring the 2021 HR trends in more detail. Also, for information about training courses on Leading and Managing Remote Teams, wellbeing/resilience or Creating a Working Balance then contact Emma O’Connor.

Consistent with our policy when giving comment and advice on a non-specific basis, we cannot assume legal responsibility for the accuracy of any particular statement. In the case of specific problems we recommend that professional advice be sought.


Get in touch

If you have any questions relating to this article or have any employment issues you would like to discuss, please contact the Employment team on [email protected]

shutterstock 531975229 (1)

Stay ahead with the latest from Boyes Turner

Sign up to receive the latest news on areas of interest to you. We can tailor the information we send to you.

Sign up to our newsletter
shutterstock 531975229 (1)