It is widely known that the Coronavirus Job Retention Scheme (the “Furlough Scheme”) is coming to an end on 31 October. As of 1st November, the Government will launch the Job Support Scheme (“JSS”) to offer further protection to employees impacted by the COVID-19 crisis.
The Job Support Scheme will run for a 6-month period.
Eligibility for the Job Support Scheme
Our Employment team has helped us to summarise what employers and employees need to know in advance of the Job Support Scheme launching.
— To be eligible, employees must work a minimum of 33% of their usual hours. This position will be reviewed after three months.
— Employers will be able to switch on and off the employee’s participation in the JSS and employees are not required to be working the same working patterns each month. However, each short-time working arrangement must cover a minimum period of seven days.
— Employees cannot be made redundant or put on notice of redundancy during the period within which their employer is claiming the grant for that employee.
— Employees must be on an employer’s PAYE payroll on or before 23 September 2020.
— Employers must pay employees at the normal wage rate for any hours worked. For every hour not worked, the Government and employer will pay a third each of the usual hourly wage for that employee, with the employee waiving the remaining third. The Government’s contribution will be capped at £697.92 per month per employee.
— Employers must agree the new short-time working arrangements with their staff and notify the employees in writing.
— All employers with a UK bank account and UK PAYE schemes can claim a grant. However, large businesses will have to pass a financial assessment test linked to their turnover in order to be eligible.
— Employers can also claim a JSS grant in addition to the Job Retention Bonus if they meet the eligibility criteria.
— Neither the employer nor the employee needs to have previously used the furlough scheme in order to benefit from the JSS.
— HMRC will check claims. Payments may be withheld or need to be paid back if a claim is found to be fraudulent or based on incorrect information
— The grant will not cover Class 1 employer NICs or pension contributions. These will remain payable by the employer.
The Chancellor’s Extension to the Job Support Scheme
On 9 October 2020, the Chancellor, Rishi Sunak, announced a further extension to the Job Support Scheme. The Government states that the purpose of the expansion is to protect jobs over the coming months and to support local businesses required to close their premises due to Coronavirus restrictions and to enable them to reopen again once lockdowns have ended.
The key points of the expansion for businesses required to close are set out below:
– The Government will pay two-thirds (or 67%) of employees’ wages up to a maximum of £2,100 a month. The level of protection, however, is lower than under the furlough scheme where up to 80% of employees’ salaries were protected up to a maximum of £2,500 per month.
– Employers will not be asked to contribute towards employees’ salaries, however they will be asked to cover National Insurance and pension contributions.
– Businesses will only be eligible to claim the grant whilst subject to local or national lockdown restrictions and employees must be off work for a minimum of seven consecutive days.
– In line with the rest of the JSS, payments to businesses will be made in arrears via an HMRC claims service which will be available from early December.
– There is also an increase in cash grants available to businesses required to close during local lockdowns of up to £3,000 a month accessible within two weeks of closure.
Contact the team with any questions
If you have any questions about the Job Support Scheme, please contact our employment team who will be happy to advise and guide you through any uncertainties. Email Tracey Guest, our Head of Employment, or fill in our contact form with details about your situation, and we’ll be in touch.