Job Support Scheme – further amendments

Please note, since this article was first published the Government has announced a further extension to the Coronavirus Job Retention Scheme to 31 March 2021, meaning that the Job Support Scheme will no longer take effect from 1 November as originally proposed. Please see our latest article.

The Government’s new Job Support Scheme (JSS), first announced on 24 September 2020 (see our original article) and subsequently extended to cover businesses that are required to close as part of local or national restrictions (see our subsequent article), has been further amended to provide additional support to businesses.

As a result of the latest announcement by the Chancellor on 22 October 2020, the Government will be increasing its contribution to wage costs under the JSS for businesses that are permitted to stay open, but which are facing lower demand as a result of COVID-19.  Under the revised ‘open’ scheme, employees will receive up to two thirds of their usual salary for hours not worked.

The scheme, which will run for a period of six months from 1 November 2020, will now provide as follows:

• the minimum number of hours worked by an employee to be eligible under the ‘open’ scheme will be just 20% of their normal hours, rather than 33% as originally announced
• the employer contribution to pay for hours not worked by the employee will be just 5%, capped at £125 per month, rather than a third of the unworked hours as originally announced. Employers can top up wages above the 5% contribution at their discretion
• the Government will pay up to 61.67% of wages for hours not worked, to a maximum of £1541.75 per month (rather than £697.92 as originally announced), meaning that employees will take home at least 73% of their normal pay for working 20% of their usual hours.

As previously announced, the scheme also provides as follows:

• grants under the scheme will be available to all employers with a UK bank account and UK PAYE scheme. A financial impact test will apply to large employers (250+ employees) but not to small or medium employers. Employers do not have to have previously used the Coronavirus Job Retention Scheme
• employees can be rotated on and off the scheme, but each short time working arrangement must cover a minimum period of seven consecutive days. Employers must agree the temporary working arrangement in writing with the employee
• employees cannot be made redundant or put on notice of redundancy during the period the employer is claiming under the JSS for that employee
• the grant received under the JSS does not cover Class 1 employer NICs or pension contributions, which remain payable by the employer
• grants will be payable in arrears and can be claimed online from 8 December 2020
• employers will still be able to claim the Job Retention Bonus of £1,000 per employee, provided they remain in employment and not under notice of termination as at 31 January 2021.

A factsheet setting out further details of the amended JSS and examples of how it will work in practice has been published, together with a policy paper with details of the eligibility criteria and including an explanation of how to calculate wages in accordance with the scheme, with worked examples.

In addition, the Chancellor has announced an increase to the level of grant available to the self-employed, from 20% up to 40% of profits, up to a maximum of £3,750. Grants will be payable in respect of the three month periods 1 November 2020 to 31 January 2021 and 1 February to 30 April 2021. The Chancellor also announced increased business grants available to those businesses in high or very high alert level areas.