Job Support Scheme – Further Explained
Following on from our article on the 1st October 2020, Rishi Sunak has announced further changes to the Job Support Scheme (JSS). The announcements include development of the Job Support Scheme (Open) and Job Support Scheme (Closed).
Job Support Scheme (Open)
This scheme is relevant to the employees of business which remain open but are facing reduced demand and so, do not need their normal levels of staffing. The key developments include:
- Minimum hours worked – An employee will need to work at least 20% of their usual hours to qualify (rather than 1/3 as previously announced). However, as before, the employer will still pay their employees for the hours worked.
- Hours not worked – The Government will pay 61.67% of the wages for hours not worked up to a maximum contribution of £1,541.75 p/m. The employer must contribute 5% of reference pay for the hours not worked up to a maximum of £125 p/m (Unless they choose to contribute more).
- What does this mean? – The new announcements mean that as an employer, you will be contributing significantly less than previously announced for hours not worked
As an employee, you will receive at least 73% of your normal wage, where you earn £3,125.00 or less per month.
Which employers can take part?
- Small and medium sized businesses are eligible, although no precise definition has been provided. Typically, the standard definition of ‘small and medium’ must have at least two of the following:
- Turnover less than £25 million
- Under 250 employees
- Gross assets of less than £12.5 million
As we previously announced here, Large Businesses may be able to take part in the scheme, but must pass the ‘financial assessments’ test. i.e.
- Be able to prove they are adversely affected by the pandemic
- Cannot pay dividends whilst using the JSS.
Further detail of the ‘financial assessment’ test can be found here
Employers can still qualify for the scheme if they have previously furloughed employees and can still qualify for the ‘job retention scheme bonus’ for those employees on shorter hours. Further information on the Job Retention Scheme bonus can be found here.
Job Support Scheme (Closed)
Following on from Aspires updates which can be found here, the government have provided further clarity of how the JSS will extend to workplaces which have been forced to close as a result of the COVID 19 restrictions imposed by the four Governments of the UK.
Where a workplace has been legally instructed to close their premises because of local Government restrictions, their employees may qualify for the JSS.
What does this mean? – The government have announced that the employee will still receive 2/3 of their normal wage whilst not working.
The 2/3 will be paid by the Employer and fully refunded by the Government up to a maximum contribution of £2,083.33 per month whilst the restrictions are in place.
The employee may also be entitled to further support in the form of universal credit if applicable.
Which employers qualify?
In the addition to the general Job Support Scheme eligibility criteria above, employers are eligible to claim JSS closed if:
- their business premises at one or more locations has been legally required to close as a direct result of coronavirus restrictions set by one or more of the four governments of the UK
- This includes premises restricted to delivery or collection only services from their premises and those restricted to provision of food and/or drink outdoors
Businesses premises required to close by local public health authorities because of specific workplace outbreaks are not eligible for this scheme
A further detailed list of eligible employers is expected to be announced by the Government at the end of October.
Other Key Points
Employers cannot claim JSS where their employees
- are serving a notice period or
- have been made redundant
Aspire Business Partnership ("Aspire") provide WK1 with practical and commercially sound advice in relation to all aspects of compliance, business strategy and conflict resolution. WK1 engage Aspire on a retained basis through which Aspire provide WK1 with advice on an ad-hoc basis.
