The Job Support Scheme (JSS) will replace the Job Retention Scheme (JRS).
The JRS has been in place since March 2020 to provide wage assistance to employers who were unable to provide work to their employees because of the impact of the coronavirus, and to avoid redundancies. This will end on 31st October 2020 and the JSS will begin on 1st November 2020.
The JSS will only support those who are working fewer hours than normal; not those who are working no hours. For the first three months of the JSS, employees must work for at least one third of their normal working hours after which this minimum threshold will be reviewed by the Government (at the three-month point). Importantly, the employer must agree reduced working hours with their employees and ensure that the employees are notified in writing.
The employer will need to pay employees for the hours they work, which must be at least one third of their normal working hours. They must also pay the employee for one third of the amount of ‘lost hours’ i.e. the hours the employee would normally work but is not working.
The Government will provide pay for one third of the number of lost hours up to a maximum cap of £697.92 per month. The employer’s contribution of one third of pay for hours not worked is, however, not subject to a monetary cap. This means that all employees on the JSS will continue to earn at least 77% of their normal wages, where it hasn’t been affected by the Government’s cap.
Employers of any size with a UK bank account and UK PAYE schemes will be able to use the JSS but large businesses will have to meet a financial assessment test to show that their turnover is lower now than before experiencing difficulties from the pandemic. The Government expects that large businesses using the JSS will not be making capital distributions e.g. dividend payments or share buybacks, whilst accessing the JSS grant.
The scheme will be open to all employers regardless of if they previously used the JRS to furlough employees before or not. Equally, an employee being placed into the JSS does not need to have been furloughed before but they must have been on the employer’s PAYE payroll on or before 23rd September 2020 – meaning that a Real Time Information (RTI) submission notifying payment to the employee to HMRC must have been made on or before 23rd September 2020.
Claims can be made online from December 2020 but before then the Government are set to release further information on this soon which should answer employer’s queries in more detail.