The Job Support Scheme – 1 November 2020
The Coronavirus Job Retention Scheme (“CJRS”) will officially end on 31 October 2020. However, with rising COVID-19 infections and further government social distancing restrictions, it is widely acknowledged that many business may have no other option but to dramatically reduce jobs. As a result, the government has announced the creation of the Job Support Scheme (“JSS”) which shall commence on 1 November 2020 with the aim of protecting viable jobs in businesses who are facing lower demand over the winter months due to COVID-19.
How will the new scheme work?
- The JSS will run until 30 April 2021.
- It will help subsidise wages where employees are working at least 33% of their normal working hours.
- Employees will be paid as normal for actual hours worked and this cost will be met solely by the employer. For hours not worked, the liability will be apportioned as follows which could see employees paid up to 77% of normal earnings:
- 1/3 – government (subject to a monthly cap of £697.92);
- 1/3 – employer; and
- 1/3 – earnings waived by the employee.
- Employees must be on a PAYE payroll with a Real Time Information submission on or before 23 September 2020.
- Employees can cycle on and off the scheme and do not have to work the same pattern each month, but each short-time working arrangement must cover a minimum period of seven days.
- All small and medium sized businesses will be eligible as well as larger businesses that can demonstrate via a financial assessment test that turnover decreased during the COVID-19 pandemic.
- Employers must agree the new short-time working arrangements with their staff, make any changes to the employment contract by agreement, and notify the employee in writing. This agreement must be made available to HMRC on request.
- 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.
- Employers will also be able to claim the Job Retention Bonus if they meet the eligibility criteria here.
- A more detailed explanation of the JSS can be found here .
- Employers will need to consider carefully whether the JSS offers sufficient financial reward for maintaining the workforce due to the extra cost of paying employees for hours not worked and the additional restrictions that will be placed on its ability to restructure.
- If you are considering utilising the JSS or need to implement redundancies or contractual variations, please get in touch with the team.