Job Support Scheme - Everything you need to know

The Government has this morning published a policy paper outlining the details of the Job Support Scheme (JJS), announced by the Chancellor of the Exchequer on 24 September 2020. JSS Open is aimed at businesses who can operate safely but are facing lower demand over the winter months due to Covid-19. While businesses who are forced to close due to local restrictions can claim support via JSS Closed. The Job Support Scheme will be open from 1 November 2020 and run for 6 months, until 30 April 2021.

The policy paper now confirms agency workers with irregular working hours are in scope.

How it works

The scheme enables these businesses to retain employees on shorter hours. under the scheme the Government will pay 61.67% of hours not worked up to a cap of £1,541.75 per month, with the employer contributing 5% of non-worked hours up to a cap of £125 per month. These caps are based on a monthly reference salary of £3,125. This will ensure employees earn a minimum of at least 73% of their normal wages, where their usual wages do not exceed the reference salary. The employee will have to work a minimum of 20% of their normal hours. Agency workers are regarded as employees of an employment agency for the purposes of this scheme, provided they are employees for Income Tax purposes.

For employees, (such as agency workers) who work irregular hours/or whose pay depends on the number of hours they work, the number of usual hours is calculated based on the higher of:

• the number of hours worked in the same calendar period in the tax year 2019 to 2020
• the average number of hours worked in the tax year 2019 to 2020
• the average number of hours worked from 1 February 2020 (or the employee’s start date if later) until 23 September 2020.

Who is eligible?

The schemes are open to all employers who meet the legibility criteria, however large employers (those with 250 or more employers on payroll) wishing to access the support will need to take a Financial Impact Test to evidence this impact. 

Ways to evidence Impact:

• Employers submit quarterly VAT returns, should compare the 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.
• Employers who submit monthly VAT returns should compare the three consecutive months which are due to be filed and paid by 7 November 2020 with the same period in 2019.
• Employers who file less frequently should compare the three 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
• Large employers who are part of a VAT group will use the turnover figures for the VAT group for this calculation.

Employers are eligible to claim for employees  provided they have a written agreement with their employee stating that they have been offered a temporary working agreement. HMRC will publish further guidance on what to include in the written agreement by the end of October.

A complete list of employee eligibility requirements for JSS Closed and further guidance will be published by the end of October. Meanwhile the REC legal team will be issuing further guidance early next week.