Who is covered?
- Any SME business (those employers with fewer than 250 employees) with a UK bank account and a UK PAYE scheme are covered, can make a claim under the JSS without undertaking any financial eligibility assessment. To be eligible to claim from the Job Support Scheme, a large employer is required to show that their turnover has decreased during the relevant period.
- Employees and workers who are on the employer’s PAYE system on or before 23 September 2020 are covered by the JSS.
What is covered?
To date, the Job Support Scheme has not yet been incorporated into law; detailed statutory provisions are expected.
The JSS, as detailed in the HM Treasury Policy paper, JSS (24 September 2020) (Fact Sheet) provides the following:
- Employees/workers on the employer’s PAYE scheme are required to work a minimum of one third of their usual hours for the first three months of the JSS – the employer must pay for these worked hours in the usual way.
- Employees/workers must have been on the employer’s PAYE payroll since 23 September 2020 to be covered by the Job Support Scheme. The employee/worker does not need to have previously been on the furlough scheme (the coronavirus job retention scheme).
- The employer and the UK Government must each pay the employee/worker for one third of the hours that are not worked.
- The employee will not be paid for the remaining one third of the hours that are not worked.
- The level of UK Government contribution is capped at £697.92 per month.
- The JSS grant will not cover Class 1 employer NI contributions or pension contributions that remain payable by the employer.
- Each short time working pattern must cover a 7-day period. Employees can cycle on and off the JSS and do not need to work the same hours or shift pattern.
- Employers who retain furloughed staff on shorter hours on the JSS will be eligible to claim the Jobs Retention Bonus.
- Employers must make the appropriate payment of wages to the employee, the JSS grant is a reimbursement of a part of the wages payment, made to the employer.
- Employees cannot be made redundant whilst the employer is claiming relief under the JSS, this would include a period of time working under any Notice of Redundancy.
Who is not covered by the Job Support Scheme?
- Further detailed guidance is expected. It does not appear that employees on statutory family leave or long-term sickness absence will be covered by the JSS.
- A new or expectant mother suspended from work on health and safety grounds is eligible to receive their full pay, so that such an employee may not meet the JSS criteria, unless exceptions are made within the statutory provisions enacting the JSS.
How will the JSS operate?
- The JSS will open from 1 November 2020 to the end of April 2021. The Factsheet states that employers can make claims through the .GOV online web portal, which will open from December 2020.
- The Factsheet states that payments will be made to employers on a monthly basis.
What pay must the employee receive and what can the employer claim from the JSS?
- An employer is required to pay to the employee/worker at least one third of their usual wages for work done.
- In addition, an employer is required to pay a third of the usual hourly wage for hours not worked by the employee/worker, capped at £697.92 per month, to the employee/worker.
- The employer can then claim one third of the usual hourly wage for hours not worked by the employee, capped at £697.92 per month, from the UK Government under the JSS.
- The employer must use the pre-furlough pay/hours to calculate the usual wages of the employee/worker.
- Pending further UK Government guidance, it appears that the employer is expected to pay the Class 1 employers NIC and pension contributions on the amount of wages paid to the employee/worker (that is two thirds).
What must employers agree with staff to be placed on JSS?
- An employee or worker placed on JSS will usually receive 78% of their usual wages. For this reason, employers will need to negotiate a temporary/permanent variation to the terms of the contract of employment
- Notify the employee/worker in writing of the proposal to place them on JSS
- Confirm any agreed variation to the contract and reduction in pay in writing to the employee
- Confirm the agreed short time working hours and rota in writing.
If you are an employer or employee and would like advice on redundancy, varying terms and conditions of the contract or claiming under the JSS, we can assist. Please feel free to give us a call on 020 7228 0017.