UPDATE – click here to see the November 2020 updates to the Job Support Scheme.
What is the Job Support Scheme?
The Job Support Scheme (JSS) is designed to protect viable jobs in businesses who are facing lower demand over the winter months due to Covid-19. It starts on 1 November 2020 and will run for 6 months with a review point in January 2021. It will begin when the Coronavirus Job Retention Scheme (CJRS) finishes on 31 October 2020.
The employer continues to pay its employee for the time they work and the JSS will provide ongoing wage support for employees, providing that:
- their employers meet certain criteria;
- the employee is working at least 33% of their usual hours, and;
- the employer provides additional wage support.
An expansion of the Job Support Scheme for businesses forced to close due to local lockdowns
As of 12 October 2020, the government also announced that the JSS will be further expanded to provide cash grants to businesses of up to £3,000 per month for those required to close in local lockdowns.
Eligible firms will have been legally required to shut for some period over the winter as part of local or national restrictions. They will receive grants to pay the wages of staff who cannot work. The grants are eligible for payment after two weeks of closure.
Further details on the expanded JSS can be found on this factsheet: Job Support Scheme Expansion for Closed Business Premises
Which companies are eligible?
All employers with a UK bank account and UK PAYE schemes can claim the JSS grant. Neither the employer or the employee, needs to have previously taken advantage of the CJRS.
However, large businesses will need to meet a financial assessment test. As such, the scheme is only open to those companies whose turnover is lower now than it was before they started experiencing problems arising from Covid-19. Small and medium enterprises (SMEs) will not have a financial assessment.
Which employees are eligible?
The JSS applies to all employees, even if they have not been previously “furloughed” under the CJRS.
- They must have been on the employer’s Real Time Information (RTI) submission to HMRC on, or before 23 September 2020.
- To show that the work is viable, employees must work at least 33% of their “normal hours”.
- They must be in viable employment from 1 November 2020.
- No redundancy notice can be served on the employee while they are being paid under the JSS.
- Employees can cycle on and off the scheme and do not have to be working the same pattern each month, but each short-time working arrangement must cover a minimum period of seven days.
What are “normal hours”?
For furloughed staff, this is the actual or usual hours they worked pre-furlough.
For non-furloughed staff, this is the hours that they usually work, either over an average period if they don’t work fixed hours, or on their actual fixed working hours.
My hours have been reduced, so who pays what under the JSS?
For every hour not worked by the employee, the government and employer will pay a third each of the usual hourly wage for that employee. The government contribution is capped at £697.92 per month. The final 33% of the employee’s unworked hours remain unpaid.
This means that in cases where the employee is only required to work 33% of their normal hours, the employee will still receive at least 77% of their normal pay (save for in cases where the cap on Government’s contribution is applied).
Will NI and pension contributions be paid?
Under the JSS, the government will not pay for Class 1 employer NICs or pension contributions. These contributions remain payable by the employer.
How do I claim under the JSS?
Employers will be able to make a claim online through Gov.uk from December 2020. The grant payments will be made in arrears following a claim for a given pay period, after an RTI submission to the HMRC has been made. Payments will be made monthly and the HMRC will check claims. The grants can be used to reimburse wages already paid.
How do we implement the JSS?
Employers must agree the new short-time working arrangements with their staff, make any changes necessary to their employment contract and then notify the employee in writing. The HMRC may request a copy of the agreement.
Further information on the Job Support Scheme can be found by clicking here.