UPDATE: The government announced that England would be entering a second national Lockdown from midnight on Thursday 5 November 2020. With this announcement, it was also confirmed that the Job Retention Scheme would be extended until December 2020 with the government funding up to 80% of furloughed employee's wages. The Job Support Scheme has therefore been postponed but will replace the current scheme when it eventually ceases.
HM Revenue & Customs announced more detailed information on the Job Support Scheme (the JSS) on 22 October 2020.
The Job Support Scheme provides different types of support to businesses so they can get assistance relevant to their situation. Businesses that are open but facing decreased demand can get support for wages through “JSS Open”. Businesses that are legally required to close their premises as a result of coronavirus restrictions set by one or more of the four governments of the UK can get the support through "JSS Closed".
The JSS starts on 1 November 2020 and runs for 6 months to 30 April 2021. The government will review the terms of the scheme in January. Employers will be able to claim in arrears from 8 December 2020 and payments will be made after the claim has been approved. Neither the employer nor the employee needs to have benefitted from the Coronavirus Job Retention Scheme to be eligible for the Job Support Scheme.
Employers will be able make their first claim from 8 December 2020 on GOV.UK, covering salary for pay periods ending and paid in November. Subsequent months will follow a similar pattern, with the final claims for April being made from early May.
If AC Mole & Sons are authorised as Agents on your behalf for PAYE online then we will be able to claim this on your behalf.
How will the JSS Scheme work and who is eligible?
An employer can claim for the JSS Open and JSS Closed grant at the same time for different employees but they cannot claim for the same employee under both schemes at the same time.
Employers will be able to access the Job Support Scheme if they have enrolled for PAYE online and they have a UK, Channel Island or Isle of Man bank account.
Additional eligibility criteria will apply depending on whether the employer is claiming a JSS Open grant or JSS Closed grant, details of which can be found below.
Eligible employers will be able to claim the Job Support Scheme grant for employees who were on their payroll between 6 April 2019 and 23 September 2020. This means an RTI Full Payment Submission notifying payment in respect of that employee must have been made to HMRC at some point from 6 April 2019 to 23 September 2020.
Here are some of the other key requirements:
-
Employers can only claim for employees that were in their employment on 23 September 2020. If employees ceased employment after 23 September 2020 and were subsequently rehired, then employers can still claim for them.
-
Employees can be on any type of contract, including zero hours or temporary contracts.
-
Agency workers are regarded as employees of an employment agency for the purposes of this scheme, provided they are employees for Income Tax purposes.
-
Employers will be able to top up employee wages above the level of minimum contributions at their own expense if they wish.
-
Employees will be able to undertake training voluntarily in non-working hours. Where time spent on training attracts a minimum wage entitlement in excess of the grant payment, employers will need to pay the additional wages.
-
Employees whose hours reduce due to the COVID-19 pandemic will continue to have access to Working Tax Credit and its childcare element for the duration of the JSS scheme.
-
Parental leave – new legislation is being introduced to ensure employees entitled to parental leave will not lose out as a result of being put on the JSS.
-
Employers cannot claim for an employee who has been made redundant or is serving a contractual or statutory notice period during the claim period.
-
The Job Support Scheme grant will not cover National Insurance contributions (NICs) or pension contributions. These contributions remain payable by the employer.
-
Employers must deduct and pay to HMRC income tax and employee NICs as well as employer NICs due on the full amount that is paid to the employee, including any amounts subsequently met by a scheme grant.
-
Employers must report these payments via a Full Payment Submission (FPS) to HMRC on or before the pay date in the normal way.
-
Employers and Employees must also still pay pension contributions in accordance with the applicable pension scheme terms unless the employee has opted out or stopped saving into their pension. If applicable Student Loan deductions and the Apprenticeship Levy must also still be paid.
-
Employers claiming the Job Support Scheme may still claim the Job Retention Bonus in respect of the same employee if they are eligible.
-
There are different calculations for working out an employee’s usual hours - fixed or variable.
JSS Open Scheme – Employers facing decreased demand
For businesses facing reduced demand the JSS Open scheme will give employers the option of keeping their employees in a job on shorter hours rather than making them redundant.
The government has announced that it will increase the scale of support available to employers through JSS Open above what was initially announced, in order to protect more jobs.
The employee will need to work a minimum of 20% of their usual hours and the employer will continue to pay them as normal for those hours worked.
The employee will also receive 66.67% of their normal pay for their hours not worked. This is split as follows:
-
5% of reference salary for the hours not worked - paid by the employer up to a maximum of £125 per month, with the discretion to pay more than this if they wish.
-
61.67% of reference salary for the hours not worked – paid by the government up to a maximum of £1,541.75 per month.
This will ensure employees continue to receive at least 73% of their normal wages, where they earn £3,125 a month or less.
Employers with 250 or more employees on 23 September 2020 are eligible to claim the JSS Open if they have undertaken a Financial Impact Test demonstrating their turnover has remained equal or fallen to show they have been adversely affected due to coronavirus. Employers with less than 250 employees do not need to satisfy this test.
The financial impact test for large employers means reviewing turnover and if it has remained equal or has decreased compared to the previous year, then they will qualify. This test only needs to be taken once before the employer’s first claim for the Job Support Scheme. The test is based on comparing VAT returns in the period between 31 August 2020 and 7 November 2020, with the total sales figure from the same period in 2019.
Any charity with 250 or more employees that is registered with a UK charity regulator or is exempt from such registration will not be required to carry out the test and is eligible for this scheme.
JSS Closed Scheme – Employers who are legally required to close their premises
Businesses that are legally required to close their premises as a direct result of coronavirus restrictions set by one or more of the four governments of the UK will be eligible for JSS Closed.
This includes premises restricted to delivery or collection only services from their premises and those restricted to provision of food and/or drink outdoors.
Business premises required to close by local public health authorities as a result of specific workplace outbreaks are not eligible for the scheme.
Employers are only eligible to claim for periods during which the relevant coronavirus restrictions are in place. Employers will not be able to claim JSS Closed to cover periods after restrictions have been lifted and the business premises are legally allowed to reopen. They may then be able to claim JSS Open if they are eligible.
Each employee who cannot work due to these restrictions will receive two thirds of their normal pay, paid by their employer and fully funded by the government, to a maximum of £2,083.33 per month, although their employer has discretion to pay more than this if they wish.
Eligible employers will be able to claim the JSS Closed grant for employees if:
-
those employees’ primary workplace is at the premises which are legally required to close as a direct result of coronavirus restrictions set by one or more of the four governments of the UK; and
-
the employer has instructed the employee to cease work for a minimum period of at least 7 consecutive calendar days
The policy statement outlines closed temporary working agreements and recommends employers should discuss with their staff and make any changes to their employment contract by written agreement. When employers are making decisions in relation to the process, including deciding who they should instruct to cease work, equality and discrimination laws will apply in the usual way.
To be eligible for the grant, employers must have reached written agreement with their employee that they have been instructed to and agree to stop working for a minimum of 7 consecutive calendar days. The agreement must be available for view by HMRC on request.
Employers must maintain records relating to the terms of these arrangements for each employee. They must:
-
notify the employee of the agreement in writing
-
make sure that the agreement is consistent with employment, equality and discrimination laws
-
keep a written record of the agreement for 5 years
-
this agreement must be made available to HMRC on request
-
The employee must agree to the new arrangement.