Job Support Scheme
On 24 September 2020, the Chancellor announced the Job Support Scheme (JSS) that will run for six months from 1 November 2020 (see Legal update, COVID-19: Chancellor announces Job Support Scheme as part of Winter Economy Plan).
An HM Treasury factsheet outlines how the JSS will operate:
To be eligible, an employee must be on their employer's PAYE payroll on or before 23 September 2020 (meaning that a Real Time Information (RTI) submission notifying HMRC of payment to that employee must have been made on or before that date).
For the first three months of the scheme, an employee must work at least 33% of their usual hours. After three months, the government will consider increasing this threshold. Employees will be able to "cycle on and off the scheme" and will not have to work the same pattern each month, but each short-time working arrangement must cover at least seven days. Employees cannot be made redundant or given notice of redundancy during the period for which their employer is claiming the grant for them.
For time worked, employees must be paid their normal contractual wage. For time not worked, the employee will be paid up to two-thirds of their usual wage: for every hour not worked, the government and employer will each pay a third of the employee's usual hourly wage (the government's contribution being capped at £697.92 a month). The grant will not cover Class 1 employer NICs or pension contributions which will remain payable by the employer. Calculation of "usual wages" will follow a similar method to the Coronavirus Job Retention Scheme. Employees who have previously been furloughed will have their usual pay and/or hours used to calculate usual wages, not their furlough pay.
The statement "our expectation is that employers cannot top up their employees' wages above the two-thirds contribution to hours not worked at their own expense" is unclear. It may acknowledge that employers cannot afford to do so but it may be a prohibition.
Employers must notify employees in writing of agreed short-time working arrangements and make such documentation available to HMRC on request. Grants will be payable monthly in arrears after payment to the employee has been made and reported via an RTI return. Claims can be made online through GOV.UK from December 2020.
Further detailed guidance is now awaited.
Source: HM Treasury: Policy paper, Job Support Scheme (24 September 2020).
If you need further advice on the Job Support Scheme, please contact the Starford team on 01342 347063 or email hello@starfordlegalhr.com