271: The Job Support Scheme – What’s changed?
Since the announcement of the Job Support Scheme (JSS) on 24 September 2020 there have been significant expansions as businesses facing reduced demand since the impact of the new three- tiered restrictions object to the scheme’s practicability. The latest government guidance was released on 22 October 2020 but we are promised further guidance before the amended scheme begins on the 1 November 2020. It has come to the government’s attention that the Job Support Scheme is not a ‘one size fits all’ solution, therefore, two levels of support have been introduced known as the JSS Open and the JSS Closed.
Whilst time is of essence, employers may want to wait until guidance is released and we have further details before finalising any arrangements with employees. This is a balancing act for employers and we hope the below update will help you through these uncertain times.
What is the JSS Open and how does it work?
The JSS Open will aim to protect jobs and businesses who are facing lower demand because of COVID-19. Employer eligibility has not changed since the original announcement but employees will need to work 20% (rather than 33%) of their usual hours, paid in full by their employer. For hours not worked the government will pay up to 61.67% (previously 22%) of the employee’s wages. Employers will now only need to contribute 5% (instead of 22%) and will be required to pay NI and pension contributions. This means that employees on the scheme will receive at least 73% of their normal wages, where their usual monthly wages do not exceed the £3,125 cap. The scheme will run for six months until 30 April 2021.
The HMRC Treasury released this image on Twitter which helpfully sets out how the JSS Open will look.
What is the JSS Closed and how does it work?
The JSS Closed will aim to help businesses pay their employees’ wages if they are legally required to close due to COVID-19 restrictions. Through the scheme the government will pay 67% of employees’ wages and employers will not need to pay anything towards wages but will be required to pay NI and pension contributions. The government will review the terms of the scheme in January 2021.
The HMRC Treasury released this image on Twitter which helpfully sets out how the JSS Closed will look.
All temporary working arrangements for short hours must be agreed in writing with employees (or union). If you would like any further guidance then our employment team is here to help.