The government’s Coronavirus Job Retention Scheme (CJRS), which enabled employers to place their staff on furlough, has come to an end.
It will be replaced on November 1 by the Job Support Scheme (JSS). This new support for business is expected to be open until the end of April next year, but it will be reviewed by the government in January.
The JSS is separately defined by the government as follows:
‘JSS Open’ – for employers facing decreased demand
‘JSS Closed’ – for employers who are legally required to close their premises. This scheme remains unchanged (https://wnj.co.uk/job-support-scheme-2/).
When originally announced, JSS Open saw employers paying a third of their employees’ wages for hours not worked and required employees to be working 33 per cent of their normal hours.
But an announcement by Chancellor Rishi Sunak in mid-October has reduced the employer contribution to those unworked hours to just five per cent.
It also drops the minimum hours requirements to 20 per cent, so those working just one day a week will be eligible.
HOW IT WORKS
Under the JSS Open, for each hour not worked, the employee will be paid up to two-thirds of their usual salary.
The government will provide up to 61.67 per cent of wages for hours not worked, up to £1,541.75 per month.
Using the government’s illustrative example, for an employee whose unworked hours total £881 in the month:
One third of these unworked hours remain unpaid to the employee.
The government contributes £543 (£881 x 61.67%) under the JSS Open scheme and their pays employer £44 (£881 x 5%).
Employers using the scheme will also be able to claim the Job Retention Bonus (JRB) for each employee that meets the eligibility criteria. This is worth £1,000 per employee (https://wnj.co.uk/job-retention-bonus/).
Taking JSS Open and JRB together, an employer could receive more than 95 per cent of the total wage costs of their employees if they are retained until February.
The government will provide two taxable SEISS grants to support those who are experiencing reduced demand due to Covid-19 but are continuing to trade, or temporarily cannot trade.
It will be available to anyone who was previously eligible for the SEISS grant one and grant two, and meets the eligibility criteria.
Grants will be paid in two lump sum instalments each covering three months. The first grant will cover a three-month period from the start of November 2020 until the end of January 2021.
The government will pay a taxable grant which is calculated based on 40 per cent of three months’ average trading profits, paid out in a single instalment and capped at £3,750.
The second grant will cover a three-month period from the start of February until the end of April 2021. The government say that it will review the level of the second grant and set this in due course.
Further details of when these grants will be available and how the assessment of three months’ average trading profits will be calculated, will be provided by HMRC in due course.
The government is providing additional funding to allow local authorities to support businesses in high-alert level areas which are not legally closed, but which are severely impacted by the restrictions on socialising.
The funding will be based on the number of hospitality, hotel, B&B, and leisure businesses in their area.
It will be up to local authorities to determine which businesses are eligible for grant funding in their local areas, and what precise funding to allocate to each business.
Businesses in Very High alert level areas will qualify for greater support whether closed (up to £3,000/month) or open.
In the latter case support is being provided through business support packages provided to local authorities as they move into the alert level.