Over the last few days, there has been a lot of talk in the media regarding what the second lockdown in England would mean for the Job Support Scheme (JSS) – which was due to replace the Coronavirus Job Retention Scheme (CJRS) on 1 November. However, on the 5 November, Chancellor of the Exchequer Rishi Sunak announced that the CJRS will be continued until the end of March 2021 and would be available to the whole of the UK, due to the second lockdown in England and the uncertainty of future lockdowns and restrictions. This means that employees will be able to receive 80% of their current salary, up to a maximum of £2500.
All employers are eligible for this extension of the CJRS, and businesses will have flexibility if they want to bring employees back on a part time basis, or keep them on the scheme full time. Businesses will, however, still be asked to pay their employees national insurance and pension contributions – although this only amounts to 5% of total employment costs. It is important to note that employees will still maintain their rights to maternity leave, redundancy etc. and can still take part in training, volunteer for another employer or organisation and work for another employer if contractually allowed.
Employers will be able to re-hire employees and place them on furlough provided there had been a RTI submission for them before midnight of 30 October 2020.
The Job Support Scheme (JSS) was meant to come into action on 1 November. This scheme was meant to financially support employers who were experiencing reduced business activity as a result of the current situation. This new scheme would have seen employers claiming a grant in arrears, in order to cover some of their usual wage costs for any hours not worked in the month before. However, for the time being, the JSS has been postponed until the CJRS ends.
In order for employers to be eligible for the CRJS they must meet the following criteria:
– All employers with a UK bank account and UK PAYE schemes can claim the grant. Neither the employer nor the employee needs to have previously used the CJRS.
– The government expects that publicly funded organisations will not use the scheme, as has already been the case for CJRS, but partially publicly funded organisations may be eligible where their private revenues have been disrupted. All other eligibility requirements apply to these employers.
In order for employees to be eligible for the CJRS, they must meet the following criteria:
– To be eligible to be claimed for under this extension, employees must be on an employer’s PAYE payroll by 23:59 30th October 2020. This means a Real Time Information (RTI) submission notifying payment for that employee to HMRC must have been made on or before 30th October 2020.
– Employees can be on any type of contract. Employers will be able to agree any working arrangements with employees.
– Employers can claim the grant for the hours their employees are not working, calculated by reference to their usual hours worked in a claim period. Such calculations will broadly follow the same methodology as currently under the CJRS.
– When claiming the CJRS grant for furloughed hours, employers will need to report and claim for a minimum period of 7 consecutive calendar days.
– Employers will need to report hours worked and the usual hours an employee would be expected to work in a claim period.
– For worked hours, employees will be paid by their employer subject to their employment contract and employers will be responsible for paying the tax and NICs due on those amounts.
Chancellor Rishi Sunak said: ‘Over the past eight months of this crisis we have helped millions of people to continue to provide for their families. But now – along with many other countries around the world – we face a tough winter ahead.’
‘I have always said that we will do whatever it takes as the situation evolves. Now, as restrictions get tougher, we are taking steps to provide further financial support to protect jobs and businesses. These changes will provide a vital safety net for people across the UK.’
It is also important to note that, due to the extension of the Furlough Scheme, the Job Retention Bonus has been cancelled. It may be reinstated at some point in the future but this is uncertain.
More information on claiming and eligibility is available here