A one-off payment of £1,000 to UK employers for every furloughed employee who they bring back to work and who remains continuously employed through to the end of January 2021.
The bonus payments will be paid from February 2021, with further details of the scheme being released by the end of the month.
But the chancellor said previously furloughed employees would need to continuously remain in work until at least January to qualify, and be paid at least £520 on average in each month from November to the beginning of next year.
Mr Sunak said: “One of the most important things we can do is to get as many people as possible off furlough and back into their jobs.
“So today we are introducing a new policy to reward and incentivise employers who successfully bring furloughed staff back – a new job retention bonus.
“If you are an employer and you bring someone back who was furloughed, and you continuously employee them through to January, we will pay you a £1,000 bonus per employee.”
But the chancellor said it was vital people were not returning for jobs “for the sake of it” and must be doing “decent work” to qualify.
He added: “We will pay the bonus for all furloughed employees, so if employers bring back all nine million employees who have been furloughed this would be a £9bn policy to retain people in work.
“Our message to businesses is clear, if you stand by your workers, we will stand by you.”
The government’s Coronavirus Job Retention Scheme is set to end in October, having originally been intended to end in July, and as of next month employers will have to contribute towards paying those employees currently furloughed under the scheme. See more information on our guide at.