News alert: Major changes to ‘Job Support Scheme’
Further to our previous article about the Chancellors announcement of the new ‘Job Support Scheme’ (JSS) on 24 September, the HM Treasury have today announced that:
- The Government’s contribution to employers’ wage costs under the JSS will be increased. It will now fund 62% of the wages for unworked hours.
- Employers will now be expected to pay 5% of the cost of unworked hours instead of the 33% originally announced.
- The minimum number of hours that employees are required to work has been reduced from 33% to 20%. Therefore, employees (who ordinarily work a five day week) will be eligible if they work just one day a week.
As far as we are aware, all other conditions (and participating requirements) relating to the JSS, remain the same. The JSS opens on 1 November 2020 and is intended to run for six months. Further information can be found here, in which the Government provides the following worked example of payment splits:
A typical full-time employee in the hospitality industry is paid an average of £1,100 per month. Under the Jobs Support Scheme for open businesses, they will still take home at least £807 a month. All the employer needs to pay is a total of £283 a month or just £70 a week; the government will pay the rest.
The amended JSS makes the scheme far more generous and attractive to employers than before. The previous scheme rules effectively required participating employers to pay 55% of normal pay in return for 33% of worked hours, which made little sense to some. We now expect far more employers to take up the JSS, as a more viable means of retaining staff. As with the Job Retention Scheme, we would advise employers who wish to take part in the JSS, to agree all changes in working hours/pay in writing with the relevant employees in advance.
If you require any further advice on this or any other employment matter, then please do not hesitate to contact Jonathan Bruck.