The JSS is the second phase in UK government support measures for organisations during the COVID-19 pandemic. Under the scheme, the employer will continue to pay its employees for time worked, but the burden of hours not worked will be split between the employer and the Government (through wage support) and the employee (through a wage reduction), and the employee will keep their job.
What you need to know
Our understanding is that the JSS will open on 1 November 2020 and run for six months, until April 2021.
The JSS will give support to those businesses which, while having enough work to continue to employ their workers, are facing reduced demand which is likely to continue into the winter months. The employer must continue to pay workers for hours worked, but support through the new JSS is available for the cost of the hours not worked.
The government will make a grant to the employer equal to the cost of one third of hours not worked up to a cap of £697.92 per month. The employer will bear the cost of a further one third of hours not worked.
The employee is unlikely to receive anything further for the remaining one third of hours not worked although further detailed guidance and legislation is expected to give more clarity about whether the employer could top up the salary further.
Neither the employer nor the employee needs to have previously used the Coronavirus Job Retention Scheme (CJRS).
Further rules
JSS grants do not cover employers’ National Insurance Contributions or pension contributions. Employers must pay these costs as usual. We assume that this will be calculated on the amount paid to the employee through the payroll, but we are waiting for more guidance.
The claims portal on gov.uk will open in December 2020. Each claim will be submitted for a given pay period. Each claim must be made after the employee has been paid and that payment has been reported to HMRC through RTI. Grants reimbursing employers for the government’s contribution will be paid in arrears, on a monthly basis. Employers using the JSS will also be able to claim the Job Retention Bonus if they meet the eligibility criteria.
Any employer with a UK bank account and UK PAYE scheme can claim the grant.
Large businesses will have to meet a financial assessment test, which is to be based on turnover. Turnover must be lower now than it was before COVID-19 caused difficulties for the business. We do not yet know exactly how this test will operate. There will be no financial assessment test for small and medium sized enterprises. There is an expectation that large employers that claim the JSS grant will not be able to make dividend payments or make share buybacks. Details on how these rules will work is expected to be provided in further guidance.
Eligible employees must have been on payroll and have been included in a full payment submission made on or before 23 September 2020. This means that some newer employees who were not previously eligible for the furlough scheme can be entered into the JSS.
During the first three months of the scheme, 1 November 2020 to 31 January 2021, employees must work at least 33% of their usual hours. The government will consider increasing this minimum threshold for the following period.
For time not worked, employees will be paid up to two-thirds of their usual wage. Employees cannot be made redundant or put on notice of redundancy during the period within which their employer is claiming the grant for that employee.
Please see below for a link to the government factsheet:
