We are already aware that the Job Support Scheme (JSS) has been put in place to protect ‘viable’ jobs for businesses likely to be facing a lower demand over the winter months due to Covid-19. A factsheet has been prepared by the Government which has highlighted some further facts regarding the scheme.
- The Government will pay a third of the hours not worked up to a “cap” with the Employer also contributing a third.
- Where employees are being paid under the JSS, Employers will be allowed to claim the Job Retention Bonus providing they are eligible.
- Employers will need to have a UK bank account and UK PAYE scheme but neither the employer or employee needs to have previously used the CJRS.
- Large business will have to meet a financial assessment test to verify if their turnover is lower than before Covid-19. No financial assessment will apply for for SME’s.
- Employees must be on an Employers PAYE scheme on or before 23 September 2020 and a RTI submission notifying payment to HMRC must have been made on or before 23 September 2020. Therefore for the majority of monthly paid employees – this means on the payroll for the month ended 31 August 2020.
- For the first 3 months of the scheme, the employee must work at least 33% of their usual hours – after 3 months the Government will consider whether to increase this minimum hour threshold.
- Employees will be able to come on and off of the scheme and can work varied hours each month, however each short-time working arrangement must cover a minimum period of 7 days.
- For every hour not worked by the employee, both the Government and Employer will pay a third each of the usual hourly wage for that Employee. The Government contribution will be capped at £697.92 a month.
- Grant payments will be made in arrears and not in advance as can be the case under the Furlough arrangement. This means that the grant can only be submitted to HMRC once the RTI has been submitted and payment made to the employee. The grant will not cover Employers NIC or Pension costs and these remain payable in full by the Employer.
- “Usual” wages calculations will follow a similar methodology as the CJRS. The amount will be based on their normal pay and hours and not the amount paid under Furlough if they are on Furlough at the time the new scheme is introduced. It is expected that Employers will not be allowed to top up pay above the two-thirds contribution.
- Employees cannot be made redundant or put on notice of redundancy during the period within which the Employer is claiming the grant for the employee.
- Employers must agree in writing the new short-time working arrangements with their staff and make necessary changes to the employment contract by agreement.
- It is intended that the Government will inform employees directly the full details of the claim relating to them.
- There is currently no specific mention relating to Directors although I feel that they will be able to apply this as long as they had been reported on a RTI prior to 23 September.
Example per Gov.UK
Beth works 5 days a week and earns £350 / week (£70 per day)
Rather than making Beth redundant she is put on the JSS working 2 days a week (40% of her usual hours)
Employer pays Beth £140 for the 2 days she works
Under the JSS Beth will receive 2/3 of her remaining pay £140 (£210 * 2/3)
The Employer will pay £70 of the JSS amount
The Government will pay a grant of £70 of the JSS amount
Beth receives pay of £280 (80% of her normal wage)
The views expressed in this article are the personal views of the Author and other professionals may express different views. They may not be the views of Lambert Chapman LLP. The material in the article cannot and should not be considered as exhaustive. Professional advice should be sought in connection with any of the issues contained in the article and the implementation of any actions.