With the current Coronavirus Job Retention Scheme (CJRS) coming to end on 31 October 2020. The Government announced a new Job Support Scheme (JSS), that will follow on from the CJRS, and will open from 01 November 2020. The JSS will be in place for at least six months as part of the Winter economy plan.
This guidance will assist through the mind field of the new scheme and will be updated when further details are received.
|What is the JSS?||With the Economy opening up, the JSS is designed to protect viable jobs in businesses who are facing lower demand over the winter months due to Covid-19, to help keep their employees attached to the workforce. The company will continue to pay its employee for time worked, but the burden of hours not worked will be split between the employer and the Government (through wage support) and the employee (through a wage reduction), and the employee will keep their job.|
|Who is eligible?||SME’s will be eligible to use the scheme as it is designed to support on those businesses that need it most: focusing on those that are being impacted by Coronavirus and who can support their employees doing some work, but that need more time for demand to recover. Large businesses will have to meet a financial assessment test.|
|Rules of the scheme||Employees must be on an employer’s PAYE payroll on or before 23 September 2020. This means a Real Time Information (RTI) submission notifying payment to that employee to HMRC must have been made on or before 23 September 2020. To support viable jobs, for the first three months of the scheme the employee must work at least 33% of their usual hours. After 3 months, the Government will consider whether to increase this minimum hour’s threshold. Employees will be able to 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 wage does the scheme cover?||The employee will need to work a minimum of 20% of their usual hours and the employer will continue to pay them as normal for the hours worked. Alongside this, the employee will receive 66.67% of their normal pay for the hours not worked – this will be made up of contributions from the employer and from the government. The employer will pay 5% of reference salary for the hours not worked, up to a maximum of £125 per month, with the discretion to pay more than this if they wish. The government will pay the remainder of 61.67%, of reference salary for the hours not worked, up to a maximum of £1,541.75 per month. This will ensure employees continue to receive at least 73% of their normal wages, where they earn £3,125 a month or less.|
|What Companies need to do?||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.|
|Small print||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. Grant payments will be made in arrears, reimbursing the employer for the Government’s contribution. The grant will not cover Class 1 employer NICs or pension contributions, although these contributions will remain payable by the employer. The Government contribution will be capped at £697.92 a month. 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. Grants can only be used as reimbursement for wage costs actually incurred.|
|Examples||If Beth was being paid £587 for their unworked hours, the government would be contributing £543 and their employer only £44.|