Information correct as of 22 October 2020.
Documents to refer to:
The Job Support Scheme guidance published 22 October 2020
1. What is the Job Support Scheme?
This is a way that the UK Government are offering to support SMEs as an alternative to employers making redundancies.
All SMEs will be eligible and no financial checks will be made on them or charities. Larger businesses with over 250 employees will not be eligible unless they can meet a financial impact test to demonstrate turnover has stayed the same or is lower than pre Covid.
There are 2 schemes:
Job Support Scheme Open
If an employer has work for some hours (at least 20% of an employee’s original hours), they can offer them to the employee and pay these as normal. The employee will then receive 66.67% of their normal pay for the hours not worked. The employer will pay 5% of pay for hours not worked, up to a maximum of £125 per month. Employers will also need to pay NIC and pension contributions.
Employers can pay more than 5% if they wish. The Government will pay the remaining 61.67% of pay for hours not worked, up to a maximum of £1,541.75 per month. The worker will continue to receive at least 73% of their normal wages, where they earn £3125 a month or less.
Job Support Scheme Closed
If an employer is legally required to close due to Coronavirus, employees will continue to receive two thirds of their normal pay, paid by their employer and fully funded by the Government, up to a maximum of £2,083.33 per month. The employer can pay more than this if they wish. The scheme can only be used up until restrictions have been lifted, they cannot continue to claim once they are legally allowed to reopen.
A closure must be for a minimum of 7 consecutive calendar days.
This scheme includes premises restricted to delivery or collection only services from their premises and those restricted to provision of food and/or drink outdoors. Those workplaces required to close by Public Health due to Coronavirus outbreaks are not eligible for the scheme.
2. When does the scheme start?
It starts on 1st November 2020.
3. How long will the Job Support Scheme run for?
The scheme runs for six months from 1st November 2020 to 1st April 2021.
4. Can an employer make a claim under both schemes?
An employer can claim the JSS Open and JSS Closed grant at the same time for different employees. They cannot claim for a single employee under both schemes at the same time.
5. Are there any other alternatives to making staff redundant?
Yes, you can consider the following:
- Layoffs for a temporary period
- Reducing hours for a temporary period
- Reducing hours for a permanent period
6. Are all employees eligible for this scheme?
Employees must be on an employer’s PAYE payroll between 6 April 2019 to 23 September 2020. Therefore, only employees who were on the employer’s RTI submission on or before 23rd September 2020 are eligible. This includes those on zero-hour contracts, casual contracts and agency workers.
7. What if someone left after 23 September 2020 and were rehired?
Employers can claim for employees who left after 23 September 2020 and were subsequently rehired.
8. Can we use this scheme if we didn’t use the furlough scheme?
Yes, you can.
9. If we need to make redundancies, can we do that and use the scheme at the same time for notice periods?
No. Employees cannot be made redundant or put on notice of redundancy during the period in which their employer is claiming the grant for those individuals. This differs from when employees were on furlough. It is not clear if this includes those on notice for reason other than redundancy.
10. Can employees go on and off the scheme as required?
Employees can go on and off the scheme and work different patterns, as long as each working arrangement covers a minimum seven-day period.
11. What’s the minimum number of hours employees’ can work?
If the business can stay open – called the Job Support Scheme Open
The employee must work at least 20% of their usual hours.
If the business cannot stay open due to national/local lockdown
The employee cannot work any hours.
12. Can training count towards the 20% of working hours?
Yes, training should be paid at full pay and will count towards the 20% minimum of usual hours to be worked.
13. Can an employee do training in unworked hours?
Employees will be able to undertake training voluntarily in non-working hours. However, where time spent on training attracts a minimum wage entitlement in excess of the grant payment, employers will need to pay additional wages to meet minimum wage.
14. Can annual leave be taken on the scheme?
Awaiting further guidance on this point, annual leave can be taken and should be paid at 100% but further guidance is needed around individuals being expected to work at least 20% of hours.
15. The scheme refers to ‘usual wages’, what happens where employees have been furloughed or on reduced hours?
‘Usual wages’ are based on their normal pay, not furlough pay. Calculations will follow a similar system as the Coronavirus Job Retention Scheme.
Further detail is expected on calculating the reference salary but it should include regular payments employers are obliged to make such as regular wages, non-discretionary payments for hours worked, including overtime, non-discretionary fees, non-discretionary commission payments and piece rate payments. Calculations cannot include payments made at the discretion of the employer, where there was no contractual obligation to pay it including: tips, discretionary bonuses, discretionary commission payments, non-cash payments and non-monetary benefits such as benefits in kind (i.e. company car) and salary sacrifice schemes (including pension contributions) that reduce an employee’s taxable pay.
16. What reference salary should be used for those with fixed pay?
You should use the greater of:
- The wages payable to the employee in the last pay period ending on or before 23 September 2020.
- The wages payable to the employee in the last pay period ending on or before 10 March 2020. This may be the same salary calculated under the Coronavirus Job Retention Scheme.
17. What reference salary should be used for those with variable pay?
You should use the greater of:
- The wages earned in the same calendar period in the tax year 2019 to 2020.
- The average wages payable in the tax year 2019 to 2020.
- The average wages payable from 1 February 2020 (or the employee’s start date if later) until 23 September 2020.
18. How do we calculate ‘usual hours’ for employees work fixed hours?
For employees who are contracted for fixed hours and pay does not vary according to the number of hours worked, usual hours are calculated based on the greater of:
- The hours that the employee was contracted for at the end of the last full pay period ending on or before 23 September 2020.
- The hours that the employee was contracted for at the end of the last full pay period ending on or before 19 March 2020. This may be the same number of hours calculated under the Coronavirus Job Retention Scheme. For those who reduced to part time working, guidance will be provided.
This should include hours paid as annual leave and statutory leave.
19. How do we calculate ‘usual hours’ for variable hours workers?
If an individual is not contracted to a fixed number of hours or their pay depends on how many hours they work, the number of usual hours should be calculated on the greater of:
- The number of hours worked in the same calendar period in the tax year 2019 to 2020.
- The average number of hours worked in the tax year 2019 to 2020.
- The average number of hours worked from 1 February 2020 (or the employee’s start date if later) until 23 September 2020.
This should include hours paid as annual leave and statutory leave.
This calculation cannot be altered if they are expecting to work more or fewer hours in the future
20. Can we top up wages to 100% like we did on the furlough scheme?
You can top up your contribution on both the open and closed schemes if you wish.
21. What about National Insurance or Pension contributions?
The employer is responsible for paying these still – there is no government contribution.
22. How do I claim for funding under the Job Support Scheme?
Claims will be made online via gov.uk from 8 December 2020.
23. Can I claim under the scheme before I make payment to the staff member?
No. The claim will only be payable in arrears after payment has been made to the employee and after the payment has been reported to HMRC via the RTI.
24. What earnings period will be used for calculations for maternity, paternity, shared parental, adoption and parental bereavement leave)?
The Government is introducing legislation to ensure that individuals are not disadvantaged and so they will not lose their right to parental pay if they are placed on the JSS in the relevant earnings assessment period.
25. Do I need to do any documentation like with the furlough scheme?
Yes, you need to agree the arrangements with staff and notify the employee in writing. You should retain these records for 5 years as per with the furlough scheme. You should also keep a record of how many hours employees work and the number of usual hours they are not working.
26. Can we still claim under the Job Retention Bonus for those who are on the JSS?
Yes, as long as all eligibility criteria is met.
27. When will further guidance be available?
Further guidance is expected at the end of October 2020.
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