We look at the latest guidance on the Job Support Scheme that was announced by the government on 22 October. 

Snapshot

• The Scheme now consists of open and closed: the former for those who meet the relevant Financial Impact Test, and the latter for those that have had to close as a result of Covid-19 restrictions.  
• The Open Scheme is similar to what was announced on 24 September with differences mainly in the percentage of government contribution (more below). 
• The Closed Scheme is as announced on 9 October but now with more details. 

How will it work? 

• JSS will open from 1 November 2020 for 6 months, until 30 April 2021. 
• Employers will be able to claim from 8 December 2020 in arrears. 
• It's not a requirement to have benefited from CJRS either for employees or employers. 
• Claim periods can start from 1 November and are subject to a maximum reference salary of £3,125 per month. 

Funding Support: Open 

• Employee will need to work a minimum of 20% of their usual hours, for which the employee will need to be paid their usual salary
• For the unworked hours, the employee will get two-thirds of their pay comprising: 
• 61.67% from the government, up to a max. of £1,541.75 per month 
• 5% from their employer, up to a max. of £125 per month 
• All in all, the employee will get at least 73% of their normal wages where they earn £3,125 or less per month.  
• The reference salary includes: 
  • regular wages 
  • over-time (non-discretionary) 
  • non-discretionary fees 
  • non-discretionary commission payments 
• Exclusions: 
  • All forms of discretionary payments including tips, bonuses, commission payments, non-cash payments, non-monetary benefits in kind and salary sacrifice schemes that reduce an employee's taxable pay 

Funding Support: Closed

• Each employee will receive two-thirds of their normal pay, up to a maximum of £2,083.33 per month. 
• Employer can pay more if they wish 

Eligibility for both schemes

• An employer can claim both at the same time for different employees but not for the same employee. 
• Employer need to have enrolled for PAYE online and have a UK bank account. 
• Employees were on the PAYE payroll between 6 April 2019 and 11.59pm on 23 September 2020 i.e. RTI submissions made to HMRC between these dates. 
• Employees were in their employment on 23 September 2020 (although those terminated after that date and re-hired are eligible).
• Employees can be on zero hour contracts or temporary contracts, including agency workers. 
• For Closed Scheme: 
  • Employers' premises have been legally required to close as a direct result of Covid-19 restrictions set by one or more of the four governments of the UK. 
  • The employer must have instructed employees not to work for a min. period of at least 7 consecutive calendar days. 

Open Scheme Financial Impact Test ('FIT')

• Employers with less than 250 employees on 23 September 2020 can claim without the need to pass the FIT. 
• Employers with 250 or more employees on 23 September 2020 have to undertake the FIT, demonstrating their turnover has remained equal or fallen to show that they have been adversely affected due to Covid-19.  
• Employers only need to take and pass the FIT once before they apply for funding – no need to continuously pass the FIT. 
• The way the FIT works is via VAT returns, and comparing the total sales figure on their VAT returns. 
  • For example, those who file quarterly VAT returns should compare total sales figure on their VAT return which is due to be filed and paid between 31 August 2020 and 7 November 2020 with the total sales figure from the same quarter in 2019. 
  • Those who file their VAT returns monthly should compare the 3 consecutive months which are due to be filed and paid by 7 November 2020 with the same period in 2019. 
  • Those who file less frequently should compare the 3 consecutive months which are due to be filed and paid by 7 November 2020 with the same period in 2019 but will need to have submitted a VAT return between 31 August 2020 and 7 November 2020 to be eligible. 

Consent for JSS Open 

• Employers must have reached written agreement with their employee that they have been offered a temporary working agreement. 
• This temporary working agreement must cover at least seven consecutive days. 
• Employers should discuss with their staff and make any changes to their employment contract by written agreement. 

Consent for JSS Closed 

• Employers must have reached written agreement with their employee that they have been instructed to and agree to stop working for a minimum of 7 consecutive calendar days. 
• Employers should discuss with their staff and make any changes to their employment contract by written agreement. 

Other conditions 

• Employers cannot claim for those employees who have been made redundant or is serving a contractual or statutory notice during the claim period. 
• Employers are strongly encouraged not to make capital distributions during the claim period. 
• There will not be support for NICs or pension contributions. 
• Employers cannot enter into any commitment or transaction with the employee that would reduce wages below the amount claimed unless such deductions were previously authorised by the employee (in their employment contract) but such deductions cannot be administration charges, fees or other costs in connection with the employment.