Job Support Scheme – revised October 2020. What you need to know……..

Under the terms of the original Job Support Scheme, businesses could be required to pay almost 60% of wage costs for just 33% of an employees worked hours.

It was questioned whether this really offered any form of realistic  encouragement for employers to retain staff.

It seems that the Chancellor has now had similar thoughts and has ramped up the help to businesses by improving the terms of the scheme considerably.

There are now two aspects of the JSS scheme, one for businesses that are having to reduce staff working hours generally and one for those that have been forced to close by the four Governing bodies in the UK. We will refer to the  schemes as JSS open and JSS closed.

Both schemes have a number of common features many of which have been brought forward from previous versions of coronavirus support schemes but to be clear in order to qualify the employer does not previously have needed to have used the CJRS scheme.

• The Scheme will be available from 1 November 2020 until 30 April 2021. After the initial 3 month period the government will review the terms of the scheme and tweak it if necessary.

• Employers will need to initially pay the appropriate level of wages to employees and then submit a claim in arrears, so there will be short term cashflow issues. The first date that a can be made is 8 December 2020.

• Eligible employees must be on the company’s payroll prior to 23 September 2020.

• If they were made redundant after that date and subsequently brought back into employment they will still be eligible

• An employer can claim under the JSS Open and JSS Closed scheme for different employees in the same period or the same employee for different periods.

• Employers must have a current PAYE online scheme and a UK bank account.

• Claims must be for a minimum period of 7 days and employers can top up salaries under both schemes

• Employers cannot claim for an employee who has been made redundant or is under notice of redundancy

• Employers will be required to meet the cost of both employer’s NI and employer’s workplace pension contributions as appropriate. These will not be matched by the Government

• Large employers (ie those with 250 or more employees are not expected to make capital distributions or pay dividends during the period that they are using the scheme.

• Finally the previous CJRS scheme did come in for criticism where unscrupulous employers were making CJRS claims for employees that were still working for them.

In a effort to combat fraud and to demonstrate more transparency employees will be able to check if their employer has made a Job Support Scheme claim relating to them via their Personal Tax Account

.Terms relating to JSS Open specifically

• The employee will need to work for a minimum of 20% of their usual hours for a minimum of seven consecutive days.

• During that period the employer will continue to pay them as normal for the hours worked.

• Under the terms of the scheme the employer is then required to pay an additional 5% of salary in respect of non-worked hours, up to a maximum of £125 per month, although it may pay more if it wishes

• The Government will then fund a further 61.67% of the employees salary for non worked hours up to a maximum of £1,541.75 per month.

Terms relating to JSS Closed specifically

• This is only available where employers have been forced to close as a result of coronavirus restrictions set by one of the four governments of the UK

• Businesses closed because of  ‘specific workplace outbreaks’ are not eligible.

• Each employee will receive 2/3rds of their normal pay up to a maximum of £2083.33 from their employer which will be refunded by the Government.

The employer may pay more than the minimum if it wishes although it will not be able to reclaim the extra from the Government

Summary

Whatever your political viewpoint it’s certainly hoped that the current measures will help support businesses to retain employees through these difficult times.