The Job Support Scheme: Further Details
Following our update yesterday (24th September) outlining the key details of the Chancellor, Rishi Sunak’s Parliamentary speech, details are beginning to emerge about how the Job Support Scheme will operate in practice.
We can probably expect the government to release details about the new scheme in the same piecemeal fashion as it did with the CJRS and furlough scheme and we will continue to update you as things develop but for now, we can confirm the following:
- The Treasury has published a “Winter Economy Plan” which makes sure that the Job Support Scheme exists to support “viable UK employers who face lower demand due to Covid-19”. The Job Support Scheme will commence on 1st November and will run for 6 months.
- Under the scheme employees will need to work a minimum of 33% of their usual hours. For every hour not worked, the employer and the government will each pay one third of the employee’s usual pay with the government contribution being capped at £697.92 per month. Under the scheme, employees will receive at least 77% of their pay where they are eligible to receive the full amount of the government’s contribution.
- The employer will have to make the payment upfront and will be reimbursed in arrears for the government contribution.
- There is no requirement for employees to have previously been furloughed to be placed on the Job Support Scheme.
- Employers can still claim the Job Retention Bonus for employees who it keeps employed under the Job Support Scheme (provided minimum earnings thresholds are met) until January 2021.
- In a stark and direct contrast from the Furlough Scheme, employees under the Job Support Scheme must not be on a redundancy notice and employees must not be issued with a notice of redundancy whilst on the Job Support Scheme.
- The Job Support Scheme is open to all employers with a UK bank account and UK PAYE scheme. All SMEs will be eligible and large businesses will be required to demonstrate that their business has been adversely affected by Covid-19 and the government expects that large employers will not be making capital distributions, such as dividend payments whilst using the Scheme.
- The government has also published a Job Support Scheme Factsheet which starts getting into the nitty gritty of the workings of the Scheme: Click here to view JSS Factsheet.
Headline points from the Factsheet include:
- There being a requirement for employees to have been on the employer’s Real Time Information Submission on or before 23 September 2020 to be eligible under the new Scheme (no mention of TUPE’d staff as yet!)
- The minimum 33% threshold hours for which an employee must work may be increased between February and April 2021.
- Variable working patterns are fine, but the working arrangement must cover a minimum period of 7 days
- Pension and NIC contributions will not be covered by the government but the employer will still be liable to pay these.
The Job Support Scheme may have been dubbed “The Son of Furlough” but do be very aware that the Scheme is brand new and letters which you may have previously issued to staff to place them on Furlough or Flexi-Furlough will need updating to include reference to the new Scheme. Once we have further guidance from the government as to what criteria needs to be met in order to place an employee onto the Job Support Scheme, we will be preparing a suite of template documentation for your use, which will be available in good time ahead of 1st November implementation date.
Hopefully, you have the energy for Round Three (or is it Round Four!?) of Covid-19 vs Employment Law: we certainly do!
Our team are ready to support you through this next phase and if there is anything that you need, please contact your Advisor or call the team on 01274 864999