Major changes to the Job Support Scheme

David Reid
22nd Oct 2020

By David Reid, Director.

 

Today, the Chancellor announced a major revision to the terms of the Job Support Scheme, which comes into force on 1 November following the closure of the furlough scheme.

 

The key changes employers need to be aware of are as follows:

  • Employers now only need to offer employees work for 20% of their normal hours, which the employer must pay for in the usual manner
  • Employers must additionally pay employees for 5% of their unworked hours from their own funds
  • The government will pay a grant to the employer for up to a further 61.67% of the unworked hours – the maximum monthly government contribution per employee will now be £1,541.75
  • Employers using the scheme will additionally be able to claim the £1,000 Job Retention Bonus for each eligible employee they keep in employment until February 2021

 

It has also been confirmed that the Job Support Scheme will be available to employers in all four nations of the UK and that eligibility for the scheme is not linked to the employer’s location being subject to any particular tier of COVID restrictions.

 

Under the revised Job Support Scheme, and taking into account the Job Retention Bonus, the government estimates the grants in combination could cover 95% of the wages due to an employee who is retained until February 2021.

 

However, the more generous Job Support Scheme for Closed Businesses, where the employer is forced to cease operations due to local COVID restrictions, remains unaffected. Employers in this situation will be able to claim a grant for 67% of each affected employee’s wages (up to the cap of £2,100 per month) and will not additionally be required to pay anything for unworked hours from their own funds.

 

In either case, the employer will need the agreement of each affected employee to vary their contract and move onto the relevant scheme.

 

IMPORTANT NOTE: We still await the publication of the regulations which will underpin the Job Support Scheme. As soon as these are available, Just Employment Law will provide template agreements for all retained clients to enable your employees to be placed on the Job Support Scheme. We will also provide general guidance on using the scheme, similar to the guidance we produced for the furlough scheme.

 

We understand a Job Support Scheme Policy Paper is being published today, which will give further details of how the scheme works. We will incorporate the important points of this policy paper into our guidance to clients.

 

You can read the government’s full announcement here:

https://www.gov.uk/government/news/plan-for-jobs-chancellor-increases-financial-support-for-businesses-and-workers

 

You can read the updated guidance on the workings of the revised scheme here:

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/928761/JSS_Open_factsheet.pdf

 

You can read the guidance on the Job Support Scheme for Closed Businesses here:

https://www.gov.uk/government/news/job-support-scheme-expanded-to-firms-required-to-close-due-to-covid-restrictions

 

If you have any immediate questions on the workings of the revised scheme, please do not hesitate to contact us.

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