Job Support Scheme expanded to protect jobs and support businesses forced to close
09 October 2020
Chancellor of the Exchequer, Rishi Sunak has confirmed that the Government’s Job Support Scheme (JSS) will be extended in order to protect jobs and to support businesses that are legally required to close down due to coronavirus restrictions.
The Government will pay two thirds of employees’ salaries in order to protect jobs over what is expected to be a particularly harsh Winter. Local or national lockdowns could see certain businesses having to shut down, which is why the announcement has been made. It is hoped that this will protect jobs, and additionally, that it will allow businesses to reopen quickly once lockdown restrictions are eased.
Eligible businesses will receive grants of two thirds of each employees’ salary, or 67%, up to a maximum cap of £2,100 per month. Employers will be asked to pay the associated on-costs, so the employer’s National Insurance (NI) contributions, and pension contributions, but it is predicted that approximately half of all claims will not incur these costs, so employers will not be required to make any contribution at all in these scenarios.
Businesses are only able to claim the grant whilst subject to the restrictions, and employees have to be off work (on furlough) for a minimum of seven consecutive days.
The scheme will be open from 1 November 2020, and will run for a period of six months, but will be reviewed in January 2021. Payments will be made in arrears and made through a HMRC claims service, which it has been confirmed will be available from early December 2020.
Any firms that have been legally closed prior to 1 November 2020 will now be eligible for the Coronavirus Job Retention Scheme (CJRS).
The scheme is UK wide, and the UK Government has confirmed that it will work alongside the devolved administrations, ensuring that the scheme works effectively in all four nations.
Rishi Sunak said:
“Throughout the crisis the driving force of our economic policy has not changed.
I have always said that we will do whatever is necessary to protect jobs and livelihoods as the situation evolves.
The expansion of the Job Support Scheme will provide a safety net for businesses across the UK who are required to temporarily close their doors, giving them the right support at the right time.”
The Government is also increasing the amount of grants paid to businesses in England that are shut due to local lockdowns from £1,500 per month, paid every three weeks, to a maximum of £3,000 per month, paid every two weeks. The smallest businesses can now claim £1,300 per month, medium sized businesses can claim £2,000 per month, and larger businesses can claim £3,000, all paid in two fortnightly instalments.
The devolved administrations in Scotland, Wales and Northern Ireland will also receive an additional £1.3 billion to their guaranteed funding for 2020-21, to help with the response to the outbreak of coronavirus.
Additional guidance on the extended JSS will be issued in due course.
The information in this article is accurate at the time of publication. For all the latest information, news and resources on how the COVID-19 pandemic is affecting payroll professions, visit our Coronavirus hub.