Companies could soon be banned from putting any more employees on furlough, with Rishi Sunak expected to make an announcement later this week.
The Chancellor is expected to announce the ban will come into the place from the end of July, The Financial Times reports.
According to the most recent figures, 8 million people had been furloughed since the start of the coronavirus crisis.
It’s believed Mr Sunak will also give details of the job retention scheme where businesses will have to pay at least a fifth of the wages of furloughed employees from August, despite the Government extending the scheme to October.
The latest changes to the scheme are expected to include firms covering 20% to 30% of workers’ wages as the furlough scheme is wound down.
Under new terms being drafted up, employers will be allowed to take furloughed workers back part-time, and all firms using the coronavirus job retention scheme will be required to make the payments, even if they remain closed, The Times reported earlier this week.
A Treasury source said: “We’ve got two full months of support left and afterwards the government will help to pay people’s wages, but it’s fair to everyone that businesses contribute as they get back to work.”
Sunak has already said the furlough scheme will be in place until at least October but asking firms to foot a higher bill could in effect force many employers consider job cuts.