Job Support Scheme
The Job Support Scheme is designed to protect viable jobs in businesses facing lower demand due to Covid-19, to help keep employees attached to the workforce.
What is it?
The company will pay the employee for time worked, but the burden of hours not worked will be split between the employer and the Government (through wage support) and the employee (through a wage reduction), and the employee will keep their job. Meaning the government will pay a third of hours not worked (up to a cap) and the employee will receive a minimum of 77% of their normal wages. The scheme will open 1st November 2020 and run for 6 months (until April 2021).
Who is eligible?
Employer – Must have a UK bank account and UK PAYE scheme. Large businesses will have to meet a financial assessment test so the scheme is only available to those who’s turnover is lower now than before experiencing difficulties from Covid-19. No financial assessment for small and medium enterprises.
Employees – Must be on payroll (filed on an RTI) on or before 23rd September 2020. First 3 months of the scheme the employee must work 33% of usual hours, after 3 months the government may consider increasing this. Employees will be able to cycle on and off the scheme but must be on for a minimum period of 7 days.
What does the grant cover?
For every hour not worked, both the employer and government will pay a third each or usual hourly wage. This will be capped at £697.92 per month and the grant will not cover NIC or pension contributions (these will still need to be paid by the employer). Also, there is an expectation that the employers cannot top up their employees’ wages above the two-thirds contribution to hours not worked at their own expense.
How can I claim?
Claims can be made online through gov.uk from December 2020 and will be paid on a monthly basis. Claims need to be made after the RTI has been processed and the payment has been made to the employee.
HMRC will check claims, payments may be withheld or need to be paid back if a claim is found to be fraudulent or based on incorrect information. Grant can only be used as reimbursement for wage costs actually incurred. Employers must agree on the new short-time working arrangements with their staff, make any changed to the employment contract by agreement and notify the employee in writing. (this must be available to HMRC on request)
This information has been taken from the Job Support Scheme factsheet from gov.uk – https://www.gov.uk/government/publications/job-support-scheme
We are still waiting for more guidance to be released.
If you have any queries, please contact Megan: firstname.lastname@example.org or call the office on 01508571432