In September the Chancellor unveiled plans for the Job Support Scheme (JSS) which comes into force from 1 November, taking over from the Coronavirus Job Retention Scheme (furlough) that ends on 31 October. We have been waiting patiently for official guidance to be released setting out the finer detail of how the scheme will work and, importantly, which employers will qualify to access it. Today guidance has finally been published following the announcement yesterday that the scheme had been amended to increase support to employers (see yesterday’s bulletin for further information: Covid-19: Chancellor announces increased support for jobs).
The scheme has two aspects in order to address the different circumstances in play for businesses under the different restrictive tiers. Firstly, the JSS Open which is aimed at those businesses which are operating but are facing decreased demand (tiers 1 and 2). Secondly, JSS Closed which is directed at businesses that are legally required to close their premises (Tier 3).
The guidance confirms that employers will be able to access the Job Support Scheme (both open and closed) if:
- They have enrolled for PAYE online;
- They have a UK , Channel Island or Isle of Man bank account.
Furthermore, an employer can only claim for employees that were in their employment on 23 September 2020.
Employers will be eligible for JSS Open if:
- They have less than 250 employees; or
- If they have more than 250 employees, they have undertaken a Financial Impact Test which demonstrates that their turnover has remained equal or fallen in comparison with the same period in 2019 to show that they have been adversely affected by the pandemic.
The way in which you carry out a Financial Impact Test will vary depending on how often the company submits a VAT return and employers should refer to the guidance for more detail.
Employers who are looking to claim JSS Closed will not need to complete a Financial Impact Test, regardless of the size of the company.
Once the above eligibility has been determined specific conditions will need to be met. For example, for JSS Open the employee will need to work at least 20% of their normal hours as detailed in yesterday’s bulletin.
We know that this guidance will be welcomed by many of our clients who will be considering using the scheme. By way of answer to some commonly asked questions that we have received from clients:
- There must be a written agreement between employer and employee, agreeing to the changes.
- Employers will be able to top up employee wages beyond the level of minimum contributions at their own expense if they wish but there is no requirement for them to do so.
- Employers can ask staff to carry out training in working hours whilst claiming for them under JSS Open. Hours that employees spend training are paid for by the employer at their full rate of pay and will count towards 20% of their usual hours.
- An employer can claim the JSS Open and JSS Closed grant at the same time for different employees. This will address situations where the business is closed but some employees will still be able to carry out work. For example, if a restaurant is forced to close, waiting staff will be eligible for JSS Closed but a manager who is carrying out a few hours of administrative work each day would be eligible for JSS Open. An employer cannot claim for a single employee under both schemes at the same time.
There is a lot of information to digest and there will be different considerations for different businesses. If you have any questions or need any advice about how to navigate the guidance or support in place, please do not hesitate to get in touch with our employment law team. We can assist with drafting the written agreements that need to be put in place between the employer and employee in order to use the scheme.