Chancellor Rishi Sunak announced the new Job Support Scheme on 24th September. The scheme has been designed to protect jobs and will be available to employers who need support to keep their workforce once the Job Retention Scheme ends this October.
Details of the Job Support Scheme
- Employers will continue to pay employees for the time worked but usual hours not worked will be split between the Government and the employer.
- The Government will pay 1/3 of the usual pay for every hour not worked, up to a cap of £697.92 per month. The payment must be made to the employee by the employer, before it is claimed back from the government in arrears.
- The employer will pay a further 1/3 of usual pay for every hour not worked.
- If 33% of usual hours are worked, and if the JSS claim is not capped, the employee will receive 77% of usual pay.
- If the JSS claim is capped, the employer can choose to top-up the payment to 1/3 of usual pay at their own expense. The government’s “expectation” is that employers will not make voluntary top-ups above this level.
- Employer’s NIC and pension contributions are due on JSS payments, and cannot be reclaimed from the government.
- The scheme starts from 1st November and will last for 6 months to the end of April.
Who is eligible for the scheme?
- The scheme is open to all employers and for all employees regardless of whether or not a CJRS claim has been made.
- Large businesses will need to pass the financial test that current turnover is lower than pre COVID19 turnover. The government’s “expectation” is that large businesses will not pay dividends or make capital distributions while claiming JSS.
- The employees must have been included in an RTI submission on or before 23rd September (the day before the scheme was announced.)
- The employees must work at least 33% of their usual hours. They must be paid at their usual contracted rate for the hours worked. (This 33% threshold applies until January, but may be revised from February.)
- Employees cannot be on notice or redundancy during a claim period.
- Employees included in JSS claims can also be included in the Job Retention Bonus claims which will be paid in February 2021.
How can businesses make a claim?
- Claims can be made on-line through gov.uk from December (for November). Claims must relate to a specific pay period, and can only be made after the relevant RTI submissions.
- JSS claims can start and end at any time in the six months of the scheme. Each claim must be for at least 7 days (presumably calendar days.)
- Short term changes of hours must be agreed with staff and HMRC may ask to see evidence of this.
- The government intends to directly provide employees with full details of claims. There is no indication of how or when this will be done.
Issues needing further clarification
- The financial test does not apply to small or medium size businesses, but these terms have not been defined.
- Clarification is needed on how the “usual hours” are to be defined. The CJRS rules suggest that the government will choose definitions which may differ from those used in payrolls.
- The government guidance states that “usual wages calculations will follow a similar methodology as for the Coronavirus Job Retention Scheme”. Clarification is needed on what this means.
- It not clear at this time whether the employees must be continuously working prior to a JSS claim.
- Employees can only be included in a Job Retention Bonus claim if their total payments for November to January pass a minimum threshold £1,560. It is not clear at this time whether the JSS claims paid by the government are included in this threshold.
More details and clarification regarding the scheme is expected to be released very soon.