The Chancellor was coming under increasing pressure to find some sort of continuation of the Furlough support that will close on 31 October 2020. He previously announced the Job Retention Bonus Scheme to support businesses who keep employees on beyond October.
In addition to this the Job Support Scheme is now being put into place. The Job Support Scheme is designed to support viable jobs in businesses that face a lower demand due to Covid over the coming months.
For eligible employees both the Job Support Scheme and the Job Retention Bonus Scheme may apply, thus giving much needed support.
Another important point to note is that employees do not have to have been previously furloughed in order to potentially qualify for enrolment.
What period does the support apply to?
The scheme has been put in place to operate for six month between 1 November 2020 and 30 April 2021.
What companies can benefit?
The scheme is open to all employer with a UK bank account and PAYE scheme – regardless of whether they used the furlough scheme previously or not.
Which employees can you enrol?
You can enrol employees who
- have been reported to HMRC as on the business’s payroll on or before 23 September 2020
- work at least 33% of their usual hours in the first three months (this threshold will be reviewed for the second three months)
- work a minimum of seven consecutive days in this short time working arrangement pattern
- are not on notice of redundancy during the period the support is being claimed for
What will be the employer’s cost?
Employers will need to
- pay employees for the hours worked
- pay 1/3 of the employee’s usual pay for hours not worked
- cover the cost of the associated employer NI and pension costs for the above as well as the government’s contribution to the employee’s wages.
The impact of the employer NI and pension costs will vary between each client, so please contact us to discuss how this will affect you.
Can the employer top up employees wages at their own expense?
In a surprising move, HMRC stated that employers will not be permitted to top up employees wages at their own expense.
What will the government contribute?
The Government will contribute 1/3 of the employee’s usual pay for hours not worked, subject to a cap of £697.92 per month.
How will claims be made?
Claims can made retrospectively on a monthly basis via HMRC’s online portal.