Guides & Advice

Job Support Scheme | your questions answered

Published: 2nd November 2020
Area: Corporate & Commercial
UPDATE 31 OCTOBER: Following Boris Johnson’s lockdown announcement, and the extension of the furlough scheme, the Job Support Scheme will now be delayed and will instead launch when the new furlough extension ends.
What are the additional measures that have been announced?

In response to growing pressure from businesses in “tier 2” areas, the Chancellor has now changed the terms of the Job Support Scheme. This has since been described in Rishi Sunak’s recent tweet as the Open Job Support Scheme (OJSS). The main changes are as follows:

The Government will now fund 62% of the wages for hours not worked. The Employer’s contribution has also been reduced from 33% to just 5%, so employees now take home at least 73% of pay for working a new minimum 20% of hours.  The Government’s contributions towards hours not worked is still subject to a cap of £1,541.75 per month, with the employer contributing 5% of non-worked hours up to a cap of £125 per month.

This is a vast swing from the previous requirement that the employee should work one third, or 33%, of their usual working hours. This change also means that those working just one day a week will be eligible.

Employers using the scheme will also be able to claim the Job Retention Bonus (JRB) for each employee that meets the eligibility criteria of the JRB. This is worth £1,000 per employee.

The scheme will run for six months from 1 November 2020 and the increased support for employers will be reviewed “in the New Year”.

Who is eligible?

Whilst these changes have clearly been implemented with a view to addressing the gap in support for businesses in tier two restrictions (compared with those forced to close in tier 3), these changes are not explicitly tied to that status, and the scheme remains available across the UK.

The eligibility criteria are unchanged. All small and medium UK employers will be eligible for the scheme. Large businesses may still be eligible, but only if they can demonstrate their turnover has been adversely affected by the pandemic (known as a “financial impact test”). It is important to note that there is no requirement for SMEs (or charities) to undergo a financial impact test before becoming eligible for the scheme.

How do I claim this further support?

The guidance currently states that employers will be able to make a claim online through Gov.uk from 8 December 2020. They will be paid on a monthly basis, and any grants will be payable in arrears meaning that a claim can only be submitted in respect of a given pay period, after payment to the employee has been made and that payment has been reported to HMRC via an RTI return, in the usual way.

We are still waiting for guidance of the exact mechanics of the repayment mechanism, though we anticipate the online claims system will bear some similarity to the mechanism for claims under the Coronavirus Job Retention Scheme. The Government has committed today (22 October 2020) to publishing a policy paper, giving further details on eligibility criteria, conditions and timescales for making claim.

UPDATE: 9 October 2020. The Chancellor has announced an expansion of the Job Support Scheme to support businesses required to close due to local or national lockdowns
How will the expansion to the scheme work?

Companies who are legally required to shut for some period over winter as part of local or national restrictions will be given grants to pay the wages of staff who cannot work. It will not apply to those who choose to shut because of the impact of Covid-19 restrictions.

The government will pay two thirds of each employees salary (67%) up to a maximum of £2100 per month.  Larger employers benefitting from the scheme expansion will not have to contribute to their staff’s wages but will need to contribute around 5% of employee costs in the form of National Insurance and pension contributions. However, small employers who use the scheme will not have to cover NI contributions and pension contributions.

Who is eligible?

Any business, throughout the whole of the UK, subject to local or national lockdown restrictions and which as a result has employees off work for a minimum of seven consecutive days will be eligible for the scheme.  Employees must have been employed on or before 23 September 2020.  Hospitality businesses that are forced to close but can offer delivery and collection services are included in the scheme as well as those only permitted to serve food and drink outdoors from their premises.

When will it start?

It will start 1 November as it is an expansion of the Job Support Scheme detailed below, and run for six months with measures being reviewed in January 2021.  Until then, the furlough scheme will remain in place.

On Thursday 24 September Chancellor Rishi Sunak made a statement in the House of Commons, announcing targeted government support to protect jobs and minimise unemployment during the UK’s second wave of COVID-19. 

One of the measures announced was the Job Support Scheme, which will replace the Coronavirus Job Retention Scheme (furlough scheme) - currently due to come to an end on 31 October 2020.

With businesses facing increasing financial difficulties, there has been mounting pressure on the government to extend its support to help reduce the number of redundancies when the furlough scheme ends. But is this new measure enough?

Here we answer some of the common questions around the new Job Support Scheme and how you may be able to utilise this to secure jobs and retain employees during these challenging times.


What is the Job Support Scheme?

The Job Support Scheme, designed to help keep people in ‘viable’ jobs, will replace the existing furlough scheme that has been in place since March.

It will apply to those employees that are working at least a third of their normal hours (which the employer will cover) with the rate of pay being the employee’s normal pay for those hours worked. For the remaining hours not worked, the employer and government will pay one third each (the government’s contribution will be capped at £697.92 a month).

So, as an example, employees working 33% of their hours will receive at least 77% of their pay.


How long will the Job Support Scheme last?

The scheme will run from 1 November 2020 for a period of six months.


Who does the Job Support Scheme apply to?

All small and medium UK employers will be eligible for the scheme. Large businesses may still be eligible, but only if they can demonstrate their turnover has been adversely affected by the pandemic. Further details on this are expected shortly but it's expected that large businesses using the Job Support Scheme should not be making capital distributions (such as dividends) whilst accessing the grant.


Which employees are eligible for the Job Support Scheme?

To be eligible for the Job Support Scheme, an employee must have been on an employer’s PAYE payroll on or before 23 September 2020.

Employees do not have to be working the same pattern each month to qualify for the scheme, but each working arrangement must cover a minimum period of seven days. Employees will also be able to cycle on and off the scheme.


Does the Job Support Scheme cover National Insurance contributions?

The government's contribution will not cover Class 1 employer National Insurance contributions or pension contributions - it is the employer's responsibility to pay these.


How do I claim for the Job Support Scheme?

As with the furlough scheme, grant payments will be made in arrears. Therefore, the employer must pay the employee their contracted wages for their hours worked plus the government and employer contributions for the hours not worked. The employer will then be reimbursed for the government's contributions (up to the capped figure of £697.92 per month).

Employers will be able to make a claim online monthly through the gov.uk website from December 2020. Further details on this are expected shortly.


Can I use the Job Support Scheme if I didn’t use the furlough scheme?

All UK businesses can use the Job Support Scheme, regardless of whether they used the furlough scheme.


Will I still be entitled to the Job Retention Bonus if I use the Job Support Scheme?

The Chancellor has confirmed that employers will be able to use the Job Support Scheme in addition to claiming the Job Retention Bonus.

The Job Retention Bonus is a £1,000 bonus paid to businesses for each employee brought back from furlough leave, with the condition that the employee remains in continuous employment with the company until at least January 2021, and be paid at least £520 on average in each month from November to the beginning of next year.


Can I make employees redundant while they’re on the Job Support Scheme?

Employees cannot be made redundant or put on notice of redundancy during the period within which their employer is claiming the grant.  However, while further guidance is awaited, it does seems that employees can be moved out of the scheme in order to be made redundant, so there is no ban on redundancies while the scheme is in place.

An employer cannot claim the grant for any employee once it has given notice of redundancy or made the employee redundant.


Does the Job Support Scheme apply to self-employed workers?

The chancellor confirmed that the existing grant for those who are self-employed will be extended and it will be on "similar terms" to the newly announced Jobs Support Scheme.


Is the Job Support Scheme enough to save jobs?

It is hoped that the new scheme will continue to provide a lifeline for businesses that are struggling to keep their staff in employment and will likely prevented a further wave of redundancies.

However, as the new scheme requires employees to work at least one third of their normal hours (and be paid for that time by their employer, along with a third of the remaining hours not worked), some cash-strapped businesses may still struggle to fulfil this.

For those businesses that aren’t on the brink of collapse, this extra support may just be enough to persuade employers to retain their employees when the furlough scheme ends.


Contact us

We will continue to update this guide as and when new information becomes available. If you have any queries on the Job Support Scheme, or need any guidance or support, please speak to a member of your local employment team.

Alternatively, you can get in touch online or visit our employment solicitors page to learn more.

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