No 10 said on Tuesday that the scheme to prevent job losses could still be utilised by firms in the city and elsewhere that are affected by the return of strict measures to slow the spread of coronavirus.
Leicester became the first place to be placed on local lockdown, with non-essential shops being told to once again close, while schools will shut to most pupils from Thursday.
The planned opening of restaurants, pubs, cafes, hairdressers and cinemas across England from Saturday will also be put on hold in the east Midlands city.
The order will place fresh pressure on ailing businesses just as they hoped to get a boost from renewed footfall.
The prime minister’s official spokesman said: “If employers have used the furlough scheme at any point between 1 March and 30 June, which of course many will have, they can re-furlough those employees from 1 July.
If someone worked in non-essential retail and they have been able to go back to work and that non-essential retail now has to close again they will still be eligible to benefit from the furlough scheme.
It applies nationwide but obviously it’s a particular circumstance to Leicester and those surrounding conurbations at the moment.”