On Friday 9 October, the Chancellor, Rishi Sunak announced an extension to the Job Support Scheme (JSS). The expanded scheme will include additional support for employees of businesses that are forced to close because of local or national lockdown measures. The extended scheme will run in parallel with the main JSS for 6 months from 1 November 2020. The scheme rules are due to be reviewed in January 2021.
What are the terms?
The government will pay two-thirds (67%) of employees’ salaries, up to a maximum of £2,100 a month. Employees must be off work for at least 7 consecutive days to benefit from the expanded scheme. When premises re-open the regular JSS rules will apply, whereby employees must work at least one-third of their hours, paid as normal. The government and employer will then each cover one-third of any remaining hours the employee is not working.
Businesses will only be able to claim the extended grant whilst they are subject to specific lockdown measures that require the closure of their business premises. The expanded scheme will also be available to businesses restricted to delivery or collection services from their premises. However, businesses required to close as a result of specific workplace outbreaks are not eligible for this scheme.
In line with the main JSS, the grant will be paid in arrears, reimbursing the employer for the government’s contribution. The claim portal will be launched from December 2020 and claims will be paid on a monthly basis. This means that employers will have to use cash reserves or borrow money in order to pay their employees’ wages in advance of receiving the monthly grant.
Employees of firms that are legally closed in the period before 1 November are eligible for the Coronavirus Job Retention Scheme (CJRS). Interestingly, the new JSS expansion is more generous than the current CJRS, which pays 60% of an employee’s salary up to £1,875 a month.
Eligibility and Exclusions
The JSS grant does not cover Class 1 National Insurance Contributions or pension contributions and employers will have to continue making these contributions. Employers will not be required to contribute towards wages whilst under lockdown measures but can make top up payments if they wish.
To be eligible for the JSS or JSS expansion, employees must have been registered on their employers PAYE payroll on or before 23 September 2020. This means a Real Time Information (RTI) submission notifying payment in respect of that employee must have been made to HMRC on or before 23 September 2020.
The JSS scheme (including the expansion scheme) is available to businesses that meet the necessary criteria even if they had not previously participated in the CJRS.
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