As the Coronavirus pandemic continues, thousands of employers have continued to suffer financially. A new Job Support Scheme (JSS (Open)) will come into effect on 1st November 2020 and will run for a period of six months. This new scheme replaces the furlough scheme which ended on 31st October 2020.
There is a separate Job Support Scheme (Closed) for employers that are legally required to close their premises as a direct result of Coronavirus restrictions where the government will pay 67% of wages up to a cap of £2,100 per month and minimum auto-enrolment pension contributions and NICs only. This article considers the JSS (Open).
What is the JSS (Open)?
The intention of the JSS (Open) is to safeguard jobs in businesses that will face a lower demand over the winter months as a result of COVID-19. Therefore, where employers are considering making redundancies, they are being encouraged to keep employees in work but on reduced hours.
Who is eligible for the JSS (Open)?
- In order to be eligible under the scheme, an employee must be on their employer’s PAYE payroll between 6th April 2019 and 23rd September 2020.
- For the first three months of the JSS (Open), an employee must work at least 20% of their usual hours. The employer will be liable to pay the employee for these hours worked at the employee’s normal contractual salary. After three months the government may consider increasing this threshold of hours worked.
- For those hours not worked, the employee will still be paid but only up to 66.67% of their normal pay (based on the employees’ normal contractual salary) – 5% will be paid by the employer, capped at £125 per month and 61.67% will be paid by the government. The government’s contribution will be capped at £1,541.75 a month. Employers may voluntarily top up their contribution but there is no obligation to do so under the scheme.
- The grant available under the JSS (Open) will not cover Class 1 employer national insurance contributions or pension contributions which will need to be paid by the employer.
- Each employee will not have to work the same work pattern each month, however each short-time working arrangement must last for a minimum period of 7 days.
- Those employees on the JSS (Open) cannot be made redundant or given notice of redundancy.
- The new working arrangements must be agreed in writing between the employer and employee.
Is an employee eligible even if they haven’t been furloughed previously?
Yes, employees who haven’t previously been furloughed will still be eligible to be put on the JSS (Open).
Note – Information correct as of 23rd October 2020
With only a couple of days to go before the 1st November 2020, employers should start seeking the consent of those employees that they propose putting on the JSS (Open) scheme and work towards finalising the documentation to confirm their agreement to the short time working arrangements.
Please contact us if you would like more information about the issues raised in this article or any other aspect of employment law at 02920 345 511 or firstname.lastname@example.org