New ‘Job Support Scheme’

A new ‘Job Support Scheme’ has been announced and it runs for 6 months from 1 November 2020.

This does not replace the Coronavirus Job Retention Scheme (JRS) but is a new scheme from the government supporting the wages of people in work.  The scheme will allow employers to keep employees employed on shorter hours rather than making redundancies.

To qualify for the scheme, employees will need to work at least one-third of their usual hours which is paid by the employer. Pay will then be topped up by both the employer and the government.   The employer and the government will each pay one third of the employee’s usual pay for the remaining hours not worked.  The government contribution will be capped at £697.92 per month. The government will not cover Class 1 employer NIC or pension contributions, which remain payable by the employer. Employees will therefore receive up to 77% of their normal salary.

All SMEs are eligible and larger businesses where turnover has been impacted by Covid-19.   This new scheme applies to all employees even if they were not previously furloughed but they must not be on a redundancy notice.  To be eligible employees must have been employed and on pay roll on or before 23 September 2020.

The key points are:

  • The employee must work a minimum of a third of their normal hours and be paid as normal for those by their employer.
  • The employer and the government will then each pay 1/3 of remaining unworked hours, leaving the employee to absorb the balance.
  • The government’s contribution is subject to a cap of £697.92 per month.
  • “Usual wages” calculations will follow a similar methodology as for the CJRS.
  • Employers must agree the new short-time working arrangements with their staff and adjust their contracts agreement, and notify confirmation to the employee in writing.
  • An employee cannot be made redundant or put on notice of redundancy whilst their employer is claiming the grant for them
  • All small and medium businesses are eligible but large businesses are only eligible where turnover has fallen through the Covid-19 crisis

There is a full guide to the scheme on the .gov web site which helps and further guidance is expected.  If you have any queries or need help with this please contact Ray Howard at QHR Solutions who will be happy to help as usual.