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What is the Job Support Scheme?

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Since publication of this article, on 31st October it was announced that a further national lockdown would commence starting on 5th November and ending on 2nd December.  It was subsequently announced that the Coronavirus Job Retention Scheme (CJRS) would be extended until 31st March 2021, with a review of the scheme in January 2021.  The Job Support Scheme as explained in this article has therefore been postponed until the CJRS comes to an end. 

The Job Support Scheme (JSS) is the latest scheme introduced by the Government to support businesses and employees through the economic challenges created by the global pandemic.  It will replace the Coronavirus Job Retention Scheme (CJRS) on 1 November 2020, which introduced the concept of furlough leave, and will run until 30 April 2021. There are two different versions of the JSS, and which one applies depends on whether your business has been ordered to close.  Here, our Employment Law team discuss the two varieties of Job Support Scheme, who is eligible for the schemes and how to make a claim.

Job Support Scheme Open

JSS Open is for businesses that are allowed to remain open but face decreased demand as a result of the coronavirus. Under this Scheme:

  • Employees work at least 20% of their normally contracted hours, for which they are paid their normal wages (this can include training done during normal work hours).
  • For the remaining hours not worked, the Government pays 61.67% of employees’ wages (up to a maximum of £1,541.75) and the employer pays 5% (up to a maximum of £125 a month).  

Employees can be moved on and off the Scheme but each short time working arrangement must cover at least seven consecutive days.  

If your business has over 250 employees on 23 September 2020 and you wish to use this Scheme, you will need to demonstrate that you have suffered financial hardship caused by the coronavirus in order to qualify for the Scheme, known as a financial impact test. This requirement will be met if you can show your turnover has stayed the same or decreased compared to last year.  If your business has less than 250 employees or you are a charity, you do not need to demonstrate financial hardship to participate in the Scheme.

Job Support Scheme Closed

This Scheme applies if your business is forced to close due to restrictions imposed by one of the four UK Governments. This includes businesses that have been forced to only offer takeaway/delivery service or only serve food and drink outdoors.  It does not include businesses forced to close by local health authorities due to workplace outbreaks.

Under JSS Closed, employees will be paid two thirds their normal wages by their employer, funded by the Government to a maximum of £2,083.33 per month. This Scheme will only be available as long as the business is legally required to be closed, and employers can switch to JSS Open once restrictions are lifted.

Employees claimed for under JSS Closed must have been told not to come to work for at least seven consecutive days.

Is my business eligible to use the Job Support Scheme?

If you are seeking to use the Job Support Scheme but have not in the past used the CJRS, this does not impact your eligibility; neither you nor your employee needs to have been receiving support under the CJRS to be eligible for the JSS.

To claim a grant under either version of the JSS, you must:

  • be enrolled for PAYE online; and
  • have a UK, Channel Island or Isle of Man bank account.

Your staff can be on any form of contract to be eligible, including zero hours for example, and they must meet the following criteria to be eligible:

  • have been on PAYE payroll between 6 April 2019 and 23 September 2020;
  • have been in employment on 23 September 2020; and
  • not be serving out their notice period.

If an employee left employment after 23 September and has since been rehired, you can claim for them.  It is important to note that similar to the latter months of the CJRS, you are responsible for paying pension and NI contributions on the full amount that is paid to the employee.

For either version of the Scheme, you must be able to show you have reached a written agreement with the affected employees (or their union).  You should keep this agreement for five years and must be able to show it to HMRC on request.

You are also still able to claim the Job Retention Bonus at the end of January 2021 if you place an employee on the Job Support Scheme.

How do I make a claim under the Job Support Scheme?

Payments under the Scheme will be made in arrears and, according to the Government website, you will be able to file a claim from 8 December with claim periods beginning from 1 November.

When calculating an employee’s reference salary for JSS Open, you should include regular payments you are contractually required to make, including:

  • regular wages,
  • non-discretionary payments for hours worked, including overtime,
  • non-discretionary fees,
  • non-discretionary commission payments,
  • piece rate payments.

Non-contractual payments such as discretionary bonuses, discretionary commission, or tips should not be included when calculating the reference salary.

We are awaiting further guidance on details such as holiday pay and will release this once it has been confirmed.  The coming months will continue to be ones of change for businesses and employees as more measures are taken to bring the virus under control and the search for a vaccine continues.  As we enter this new phase of job support from the Government, it is vital that employers follow the guidance and keep employees informed, following any necessary procedures you have detailed in your policies, particularly if you are considering redundancies.  To discuss any queries you have regarding the Job Support Scheme or if you need advice on redundancy consultations, you can contact us today on 023 8071 7717 or email employment@warnergoodman.co.uk.   

To receive regular Employment Law updates from the team regarding recent tribunal cases and legislation updates, you can subscribe to our weekly Employment Law Newsletter by completing our subscription form or emailing us at events@warnergoodman.co.uk

ENDS

This is for information purposes only and is no substitute for, and should not be interpreted as, legal advice.  All content was correct at the time of publishing and we cannot be held responsible for any changes that may invalidate this article.