On 1 November the Job Retention Scheme (JRS) will come to an end and will be replaced by the Job Support Scheme (JSS).
On 22 October, the Chancellor announced further changes, designed to provide different levels of support depending on the business’s circumstances. Detailed guidance has yet to be published, but the grant available will be dependent on the location and impact of the Covid-19 restrictions in place, and eligibility will be split into two categories:
- Employers facing decreased demand (JSS Open); and
- Employers that are legally require to close their premises (JSS Closed).
Where employers can operate safely but are experiencing a reduced demand due to the impact of Coronavirus, the JSS Open grant will be available.
Employees will be required to work for a minimum of 20% of their usual working hours, for which their employer will pay them as usual. They will then be paid 66.67% of their usual salary for the remaining 80% of hours not worked, which will be funded as follows:
- Employers will be required to pay 5% of an employee’s wages for the hours an employee has not worked, up to a maximum of £125 per employee per month;
- The government will fund 61.67% of the wages for the hours an employee has not worked, up to a maximum of £1,541.75 per employee per month.
Employees earning £3,125 a month or less will therefore continue to receive at least 73% of their normal wages. The employer will continue to fund all of the National Insurance contributions and pension contributions.
Where employers have been legally required to close their premises as a result of the restrictions set by the government, the JSS Closed grant will be available.
Employees who cannot work due to the restrictions in place will receive two thirds of their normal pay. This will be fully funded by the government up to a maximum of £2,083.33 per month, although employers can pay more than this if they choose.
The claims will be made in arrears, ie the claim for November cannot be made until 8 December, with the grant being paid after the claim has been processed.
Employers will be able to access the JSS schemes if:
- They have enrolled for PAYE online; and
- They have a UK, Channel Island or Isle of Man bank account.
Employees must have been on the PAYE payroll (RTI submission) between 6 April 2019 and 23 September 2020 and must have been in employment on 23 September 2020. It is possible for an employer to make JSS Open and JSS Closed claims for different employees, but they cannot claim under both schemes for the same employee.
Similar to the JRS, employers must obtain written agreement from their employees that they have been offered a temporary working agreement, which must cover at least seven consecutive days. This agreement must be available to provide to HMRC on request.
Additional eligibility criteria will apply depending on whether you are a claiming a JSS Open grant or JSS Closed grant. Some of the key requirements for each scheme are set out below.
Employers that had more than 250 employees on 23 September 2020 must undertake a Financial Impact Test to demonstrate that their turnover has fallen or remained level to the same time last year. The test only needs to be performed once before the claim is made, and will be based on figured entered into the employer’s VAT returns. For more detail on how this will be calculated, please see here.
Employers with less than 250 employees on 23 September 2020 do not need to carry out this test.
Employers may claim if their business premises at one or more locations is legally required to close as a direct result of Coronavirus restrictions set by the government. This includes businesses that have been restricted to collection or delivery only services, or those only able to provide food or drink outdoors, but does not include premises ordered to close by local public health authorities as a result of specific workplace outbreaks.
Claims under JSS Closed can only be made for the period the restrictions are in place. Once restrictions are lifted, employers can continue to claim under JSS Open, if they are eligible.
Further guidance on how to calculate and make a claim, and some more details on the eligibility requirements for both schemes, will be published by the end of October.
The schemes will run from 1 November 2020 until 30 April 2021, and the government will review the terms of the scheme in January 2021.