Following a spate of criticism against the Government on the level of support offered to workers and employers alike impacted by the implement Tier System, the Chancellor Rishi Sunak has responded and announced new changes to the Job Support Scheme (‘JSS’).
These changes are set to replace the Furlough Scheme (ending on 31st October 2020) and revises the previous announcements made under the ‘Winter Economic Plan’ set out back in September.
In summary, the taxpayer subsidy has been doubled there will now be two schemes aptly named JSS (Open) and JSS (Closed).
WHY ARE THERE TWO DIFFERENT SCHEMES?
The difference in the scheme comes down to who will be eligible to the two separate rates of support. Only businesses subject to Tier 3 restrictions (e.g. forced to closed) will be able to claim JJS (Closed).
WHAT IS THE LEVEL OF SUPPORT BEING OFFERED?
- Under this scheme an employee will need to work at least 20% (a change from working the minimum of a third) of their normal hours.
- The Employee will receive their normal pay for the hours they work and the remaining two-thirds of pay for the hours they do not work (subject to a cap of earnings above £3125.00 pcm).
- For the two-thirds of pay, the government will contribute 61.67% and the employer will pay 5%, plus National Insurance and Pension Contribution on the full amount.
- Under this scheme the employment will receive two-thirds of their normal wages, wholly funded by the Company (subject to the above cap) and the Employer is only responsible for paying the national insurance and pension contribution on that amount.
RULES ON ELIGIBLITY AND WHEN DOES IT START?
The guidance released by the Treasury has confirmed to apply for the scheme, there must be a written agreement between the employer and employee.
The schemes are open to SME’s and large business will also be eligible, if they can demonstrate that there has been a fall in their turnover.
The scheme can be applied via the online portal and will open from 1st November 2020.