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Government to pay £1,000 “bonus" for every employee brought back from furlough

Published:  08 July, 2020

The government has announced a Job Retention Bonus to support furloughed employees and businesses back into work.

A “bonus” of £1,000 will be paid to employers for every person who is brought back from furlough and stays in employment until at least January, with no cap on the number of bonuses to be paid.

If employers bring back all 9 million people who have been furloughed since the beginning of the scheme, the cost to government would £9bn, Chancellor Rishi Sunak said.

The aim is to get “as many people as possible back from furlough” and to incentivise businesses to retain staff once the scheme ends in October.

“If you are an employer, and you bring someone back who was furloughed, and you continuously employ them through to January, we will pay you £1,000 for this employee,” Sunak said during this afternoon’s summer economic update.

“It is vital that people aren’t returning just for the sake of it. They need to be doing decent work. So for businesses to get this bonus, employees must be paid at least £520 on average in each month from November to January, the equivalent of the lower earnings limit in national insurance. The House should understand the significance of this policy.”

“Our message to business is clear. If you stand by your workers, we will stand by you,” he added.

The announcement was part of a raft of measures announced today around a three-point plan of finding, creating and supporting jobs.

These include a six-month VAT cut from 20% to 5% to support the hospitality and tourism industries and a £2bn scheme to subsidise work placements for young people most at risk from unemployment.