Are you eligible for the new Job Support Scheme?
HMRC has confirmed that the final date to submit your claims under the Coronavirus Job Retention Scheme (CJRS) will be on 30th November 2020. After this date, no more new claims can be submitted or added to any previous claims.
The scheme finally comes to a close at this end of October since it began in March 2020. However, from 1st November 2020, the Job Support Scheme (JSS) will be launched. The aim of the JSS is to ensure employees are in ‘viable employment’, and are not working less than a third of their usual hours. Rishi Sunak, Chancellor of the Exchequer announced the scheme in parliament. He stated that the scheme will help protect jobs in companies who may see lower demand over the winter months.
Employers will be allowed to retain employees on reduced hours and pay, with the aid of a government wage subsidy. The government, through wage support, and the employee, through a wage reduction, will help the employer keep employees on board.
The government will pay a third of hours not worked, capped up to £697.92 per month, the employer must also contribute a third (this is not capped). Employees will earn a minimum of 77% of their average pay, if the government subsidiary does not need to be capped. If the contribution needs to be capped, the employee will be receiving a much lower percentage of their pay, depending on whether the employer is willing to make up the rest.
Employers who can claim must have a:
-UK bank account
-UK PAYE scheme.
The furlough scheme doesn’t need to have been previously used by the employee or employer to use the new Job Support Scheme.
Large employers can only use the scheme if they meet the financial assessment requirements. Turnover must have fallen as a direct result of COVID-19. If a large employer is deemed viable for the scheme, no capital distributions can be made whilst using the scheme. The government are yet to release how the financial assessment will precisely work.
In terms of employees, the employees who this applies to must have been on the PAYE payroll since before 23rd September 2020. These employees must work a minimum of 33% of their normal hours in the first three months of the scheme. The government has made the statement that they will revisit the hours to see if they need to be increased.
The grant won’t cover Class 1 employers NICs or pension contributions, these will still remain payable by the employer. It is still unclear on how the scheme will affect holiday and sickness pay, this will likely be raised when further details are released.
This scheme will end on 31st April 2021.
More information can be found here: https://www.gov.uk/government/publications/job-support-scheme
Should you have any queries regarding the Job Support Scheme, please contact our team on 01254 781969.