Changes to the Job Support Scheme
The government has now announced further changes to the Job Support Scheme (now renamed the Job Support Scheme Open), with both the percentage of working hours and the employer contribution to unworked hours dropping.
Please note: the information contained in this legal update is correct as of the original date of publication.
Last month, the government announced the Job Support Scheme, replacing the Coronavirus Job Retention Scheme from the start of November 2020. Whilst the introduction of some level of support was welcomed, the JSS faced criticism both in respect of the “viability” threshold required to access it (33% of normal hours worked) and the amount of the employer contribution required for non-working time (33% of unworked hours). Many employers, faced with minimum contributions of 55% of employees’ wages (for only 33% output), plus NI and pension contributions felt priced out of being able to access the scheme.
The government has now announced further changes to the JSS (now renamed the JSS Open), with both the percentage of working hours and the employer contribution to unworked hours dropping. Employees will now be required to work a minimum of 20% of their usual hours, with employer contributions for unworked hours dropping considerably to 5% up to a maximum of £125 per month (with discretion to pay more) (plus NI and pensions). The government contribution for unworked hours will increase to 61.67% of reference salary (capped at £1,541.75 per month).
There is a separate scheme (the JSS Closed) for those businesses required to close their premises as a result of government coronavirus restrictions. These employees will receive two thirds of their normal pay (capped at £2,083.33 per month) paid by their employer but fully funded by the government. The employer also has the discretion to top up pay if they wish.
The changes to the JSS Open will be welcomed by many, opening up the JSS to businesses who had previously discounted it due to it not being financially viable. Full details of the JSS are still awaited (due later in October) but further information can be found in the government’s policy paper here.