After the Chancellor Rishi Sunak’s update yesterday, please see the key points below relating to the new job support scheme for businesses that are open and for businesses that have to close at this time. There is also information relating to the self-employed scheme.
New Employment Support Scheme (JSS open)
• To qualify, some or all of your employees are working reduced hours as a direct impact of COVID-19.
• Employees only need to work a minimum of 20% of their normal hours (so 1 day a week of a 5 day week) to qualify.
• Employer will need to pay full for these hours worked. In addition, they will be required to pay 5% of the full rate for the balance of the unworked hours
• Government will contribute 61.67% of full rate for the UNWORKED hours.
• Employer will still need to pay Employer National Insurance Contributions. Also they will need to pay Employer pension contributions for those employees who are auto-enrolled.
• The payment of the job support will be made AFTER the month end once wages have been paid and a submission has been made to HMRC.
• The first claim can be made from 8th December 2020 onward (for November 2020). Subsequent months will follow a similar pattern.
• Employer can top up the monthly payments if they wish
Support Scheme for Businesses Forced to Close (JSS closed)
• To qualify your business premises, at one or more locations, must have been legally required to close as a direct result of coronavirus restrictions. This does not include closure due to a specific workplace outbreak.
• HMRC will contribute 2/3 of the employees normal pay (up to a maximum of £2,083.33 per month).
• The Employer can top up the employees pay if they wish
• Employers can only use this scheme for the period that they are under the relevant restrictions
• Further details are to be issued about the full conditions for falling within this category before the end of October
- In both cases employees can continue to claim Universal Credit, Working Tax Credits and other benefits and if their wages have been affected they will need to update their claim.
- In addition, councils have been given increased funding to enable them to make further grants to businesses who have been substantially affected by Covid. The information should be on the website of the council area in which business operates. We are aware that some councils are asking for detailed evidence of how the business has been affected.
- Parental pay legislation is to be updated so that parents don’t lose out on entitlement (current and future) as a result of being on JSS during the assessment period.
- In both cases it applies to employees on a PAYE scheme as at 23rd September (as with the original support scheme a submission with their details on will need to have been made to HMRC by this date).
- Employers will need to agree the reduced working hours and employment terms with their employees in writing (as with the CJRS scheme).
- Training can be undertaken whilst employees are on “unworked” hours. Where time spent on training attracts a minimum wage entitlement in excess of the grant payment, employers will need to pay the additional amount.
An increased third tranche of SEISS (Self employed income support scheme) has been announced for people who qualified for the original 2 tranches. This will now be for 40% of profits. This will cover period 1st November 2020 to 31st January 2021. A further payment for the following three months will also be made, the level to be decided at a later date.