New Job Support Scheme Advice From Think People
28th September 2020
To support employers who face lower demand due to COVID-19, and to keep their employees attached to the workforce, the government has recently announced the introduction of a new Job Support Scheme from 1 November 2020. Employees will need to work a minimum of 33% of their usual hours. For every hour not worked the employer and the government will each pay one third of the employee’s usual pay, and the government contribution will be capped at £697.92 per month. Employees using the scheme will receive at least 77% of their pay, where the government contribution has not been capped. The employer will be reimbursed in arrears for the government contribution. The employee must not be on a redundancy notice.
The scheme will run for six months from 1 November 2020 and is open to all employers with a UK bank account and a UK PAYE scheme. All Small and Medium-Sized Enterprises (SMEs) will be eligible; large businesses will be required to demonstrate that their business has been adversely affected by COVID-19, and the government expects that large employers will not be making capital distributions (such as dividends), while using the scheme.
The sentence: “The employee must not be on a redundancy notice”, suggests that the government will not contribute anything under the Job Support Scheme if an employee is working under notice of redundancy. This is in direct contrast to the position under the CJRS, where the scheme did pay out for employees working their redundancy notice .
Some key points to note:
- To be eligible, employees must have been on the employer’s Real Time Information submission on or before 23 September 2020
- The minimum 33% threshold hours for which an employee must work may be increased in months 4-6 of the scheme
- Working patterns can vary, but each short-time working arrangement must cover a minimum period of seven days
- The government’s grant will not cover Class 1 employer NIC or pension contributions, although they remain payable by the employer
Should you require support with transitioning to the new scheme or support with restructuring please do not hesitate to contact Think People: https://www.thinkpeople.co.uk/job-retention-scheme-government-update/