Expansion of Job Support Scheme (JSS)

We have been eagerly awaiting further details of the Job Support Scheme announced 24 September 2020 and as it was due to start 1 November it felt like it was getting a bit close to the wire.  This afternoon we found out why, the Chancellor has pretty well ripped up the earlier plan and started again.  We are still limited on detail, a JSS policy paper is due to be published today (not available at the time of writing) so keep checking for updates, as a lot of detail still uncertain.

Here is what we know so far:

When originally announced, the JSS, or as it is now known, the Job Support Scheme Open – that is for those businesses that are not required to close – which will come into effect on 1 November – saw employers paying a third of their employees’ wages for hours not worked, and required employers to be working 33% of their normal hours.

Today’s announcement reduces the employer contribution to those unworked hours to just 5%, and reduces the minimum hours requirements to 20%, so those working just one day a week will be eligible. For the time worked, the employee must be paid their contracted wage.

The maximum government contribution remains capped at £3,125 per month and so for an employee at this maximum limit the pay would be split as follows:


As can be seen from the table above, if the employee works one day a week they receive 73% of full salary with the % of full salary they receive increasing the more days they work.

This scheme will run for 6 months from 1/11/20 with a review in the new year.

The Job Retention Bonus may be claimed alongside this scheme.

Some detail:

  • Employers must have a UK bank account and a UK PAYE scheme
  • An RTI submission notifying payment to the employee must have been made on or before 23/9/20
  • There is no requirement for either employer or employee to have previously used the Coronavirus Job Retention Scheme
  • Employers with more than 250 employees will have to meet a financial impact test, their turnover must be level or lower now than before experiencing Covid-19 difficulties
  • Partially publicly funded organisations are eligible if their private revenues have been disrupted, fully publicly funded organisations are not
  • Employers must agree the temporary working arrangements in writing with their employees and this must be available to supply to HMRC if requested
  • The employee may undertake training during the 20% plus working hours whilst being claimed for
  • Variable, zero hours and agency workers are eligible
  • Employees can cycle on and off the scheme and can work different working patterns each claim period, but each short time working arrangement must cover a minimum period of seven consecutive days
  • The grant must be used to pay the employee
  • Employers can opt to increase the  employees’ wages above the 5% contribution if they wish
  • Employers NIC and pension contributions remain due
  • For variably paid employees, the “usual wages” calculation will follow a similar methodology to that used for the CJRS
  • Employees who have previously been furloughed will have their underlying usual pay and/or hours used to calculate their pay under this scheme, not the amount they were paid whilst under furlough
  • Employees can not be made redundant or put on notice of redundancy during a period where a grant under this scheme is claimed
  • The portal to make a claim will be opening on 8 December 2020 and claims may be made monthly in arrears and once the payment has been reported on an RTI return

Unchanged are:

The Job Retention Bonus

The JRB was announced in July 2020 and is:

  • a one-off payment to employers of £1,000,
  • payable for every employee for whom the employer has made a valid claim under the CJRS and who remains continuously employed through to 31 January 2021.

Eligible employees must earn at least £1,560 in total for the period between 1 November 2020 and 31 January 2021, with at least one payment being reported through RTI in each month.

The bonus will be taxable, so the business must include the whole amount as income when calculating its taxable profits for corporation tax or income tax.

Employers will be able to claim the JRB through gov.uk after they have filed their RTI returns for January.

Payments will be made to employers from February 2021.

Individuals with employees that are not employed as part of a business (such as nannies or other domestic staff) are also eligible for the JRB, just as they have been for the original and also the part-time furlough schemes, but will not have to pay tax on grants received under the scheme. 

Rules for employers

All employers are eligible for the scheme including recruitment agencies and umbrella companies. The employer must:

  • have a UK bank account;
  • have complied with their obligations to pay and file PAYE accurately and on time under the RTI reporting system for all employees to the end of January 2021; and
  • be up-to-date with payroll obligations and have addressed all requests from HMRC to provide missing employee data in respect of historic CJRS claims. 

Rules for employees

Each employee must have been:

  • furloughed and the subject of an eligible Coronavirus Job Retention Scheme claim;
  • continuously employed by the relevant employer from the time of the employer’s most recent CJRS claim for them, to 31 January 2021; and
  • paid a total of at least £1,560 for the period 1 November 2020 to 31 January 2021. The employee does not have to be paid £520 in each month but must have received some earnings in each of the three calendar months that have been paid and reported to HMRC via RTI.

Claims may be made for employees who are office holders, company directors and agency workers, including those employed by umbrella companies. These criteria must be met regardless of the frequency of the employee’s pay periods, their hours worked or rate of pay.

Employees who have returned from statutory parental leave or who are military reservists returning to work after 10 June 2020, for whom a CJRS claim has been made, all qualify provided the other eligibility criteria are met, as do employees who are on fixed term contracts.

The employee must not be serving a contractual or statutory notice period, that started before 1 February 2021.

Employees transferred under TUPE or due to a change in ownership

A new employer may be eligible to claim the JRB in respect of employees of a previous business which were transferred to the new employer if either TUPE applies, or the PAYE business succession rules apply to the change in ownership.

A new employer may also be eligible to claim the JRB in respect of the employees associated with a transfer of business from the liquidator of a company in compulsory liquidation where TUPE would have applied were it not for the company being in compulsory liquidation.

To claim the JRB under these circumstances the transferred employees must have been furloughed and successfully claimed for under the scheme by their new employer. An employer will not be eligible for the JRB in respect of any employee transferred under TUPE or under the business succession rules after 31 October 2020.

And the Job Support Scheme Expansion for Closed Business Premises.  A recap of what we know about this scheme:

  • It will be available for 6 months from 1 November 2020 with a review in January
  • The grant per eligible employee is 2/3 of normal pay capped at £2,100 per month and must be fully used to pay the employee
  • Employers must agree the scheme with relevant staff, make any changes to employment contracts by agreement and notify the employee in writing – this agreement may be requested by HMRC
  • HMRC intend to publish the names of employers using the scheme and employees will be able to check if their employer has claimed for them
  • Employers can claim if their premises are closed as a direct result of Coronavirus restrictions, but not for businesses required to close due to specific workplace outbreaks
  • It will be open to all employers with a UK bank account and a UK PAYE scheme registered with an RTI filing made on or before 23/9/20
  • The grant will be based on the number of eligible employees instructed to and who have ceased work at the relevant premises
  • The employees must cease work for a minimum of 7 consecutive calendar days
  • Claims will be made monthly in arrears
  • Payments are taxable
  • Employers NIC and employers auto enrolment pension costs are not covered but must still be met
  • No top up has to be made (but may be made)
  • Prior participation in the Job Retention Scheme is not required
  • Employees cannot be put on notice or redundancy or made redundant during the period within which the grant is being claimed
  • HRMC will publish the names of employers using the scheme and employees will be able to check online if a claim has been made relating to them within their personal tax account