On 22 October 2020 HMRC released updated guidance on the Job Support Scheme. Additional information is expected by the end of this month, but the following summarises the current position:
- There are two schemes, JSS Open and JSS Closed. The former is for businesses who continue to operate but face reduced demand. The latter is for those legally required to close their business as a result of COVID-19 restrictions.
- Businesses instructed to close by public health authorities because of a specific workplace outbreak are not eligible for JSS Closed.
- Both schemes will open 1 November 2020 and run for six months.
- Claims can be submitted in arrears from 8 December 2020.
- Neither the employer nor employee needs to have benefited under the Coronavirus Job Retention Scheme (CJRS) previously to be eligible.
- Under JSS Open, an employee will need to work a minimum of 20% of their usual hours. The employer will continue to pay for hours worked, which may be 20% or higher. The employee will then receive a minimum 66.67% of their pay for hours not worked - of which 5% will be paid by the employer and the remainder paid by HMRC.
The maximum reference pay is £3,125 per month. If an employee normally earns more than this, the scheme will not assist with additional pay beyond this threshold.
The employer can choose to top-up an employee's wages of course. However, the maximum Government support is 61.67% of hours not worked, up to a maximum of £1,541.75 per month.
- Under JSS Closed, an employee will receive two thirds of their normal pay up to a maximum of £2,083.33. This is entirely paid by HMRC - the employer is not required to contribute although they can top up if they wish.
- Employers will be eligible if they are enrolled for PAYE online and have a UK, Channel Island or Isle of Man bank account. Additional criteria are likely to apply depending on the scheme used (JSS Open or JSS Closed).
- Employees will be eligible if there were part of an RTI PAYE submission to HMRC at any time between 6 April 2019 and 23 September 2020. This means that employees hired recently are unlikely to be eligible. Employees who have been terminated after 23 September 2020, but subsequently rehired, are also eligible.
- Any employer with 250 or more employees must undertake a Financial Impact Test to be eligible for JSS Open. They must also refrain from making any capital distributions whilst claiming under the either JSS Open or JSS Closed.
- Employers cannot claim for an employee who has been made redundant or is serving a notice period.
- As with CJRS, written agreements to support the changes to working terms and conditions must be in place with each employee subject to a claim.
- The claim period / temporary working agreement must cover at least 7 consecutive calendar days. Other suitable records should be kept, e.g. to demonstrate that the selection of employees for the scheme was not discriminatory. For JSS Closed, employees must be instructed not to attend work for a minimum of 7 consecutive calendar days.
- As with CJRS, employers should not claim under JSS for employees funded through public means (e.g. Childcare place funding, or NHS payments to dentists).
- Under both schemes, employers continue to pay National Insurance and pension contributions due on the actual pay received.
- Unlike CJRS, you must claim in arrears. The relevant payment must have been made to an employee before you claim.
- Agents can claim on behalf of clients, as with CJRS.
- Employers using the scheme can still claim the Job Retention Bonus due in January. Grants claimed under JSS will count towards the Lower Earnings Limit for the Job Retention Bonus.
- You cannot claim JSS Open and JSS Closed for a single employee on the same day.
We will share additional guidance as soon as we receive it. In the meantime, if you require any assistance regarding potential JSS claims, or factoring this scheme into your plans, please don't hesitate to contact us via 0161 464 7162 or email@example.com.