A new Job Support Scheme designed to protect viable jobs for those workers in businesses that will continue to face a downturn in business over the coming months has been introduced by the Chancellor of the Exchequer this week.
The Scheme will open on 1 November after the current Corona Virus Job Retention Scheme (furlough) has come to an end and will run for 6 months.
Under the new Scheme employers will continue to pay employees for time worked but the cost of hours not worked will be split between the employer, the Government (through wage support) and the employee (through a wage reduction). The Government will pay a third of hours not worked up to a cap, with the employer also contributing a third.
The aim is to ensure that employees earn a minimum of 77% of their normal wages, where the Government contribution has not been capped. Importantly, the scheme will only apply in respect of employees who are working at least 33% of their usual hours and employers will not be able to make employees redundant whilst claiming under the scheme.
Employees must be on an employer’s PAYE payroll on or before 23 September 2020.
Employers using the Job Support Scheme will also be able to claim the Job Retention Bonus if they meet the eligibility criteria.
A factsheet setting out more details on the eligibility criteria for employers and employees; the wages covered; how employers can make a claim; and how HMRC will carry out checks has been introduced: https://www.gov.uk/government/publications/job-support-scheme
More detailed guidance on the calculation of eligible wages will also be published shortly.
Please get in touch if you have any questions regarding the issues discussed in this article.
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