The Job Support Scheme – what we know so far

• The Job Support Scheme can also be applied to those currently working reduced hours.
• Eligible businesses will still be able to claim the £1,000 grant for each employee that was furloughed under the CJRS, providing they are still employed at 31 January 2021.
• HMRC will reimburse the employer for the Government’s contribution. Employers will be able to make a claim online through Gov.uk from December 2020 and will be paid monthly. Grants will be payable in arrears: a claim can only be submitted in respect of a given pay period, after payment to the employee has been made and that payment has been reported to HMRC via an RTI return.
• The grant will not cover Class 1 employer NICs or pension contributions, although these contributions will remain payable by the employer.
• HMRC’s intention is that employees will also be informed by HMRC directly of full details of the claim.

Are there any eligibility criteria?

For an employer…

• If you are a small or medium-sized (SME) organisation you will automatically be eligible for the scheme. We anticipate that the definition of SME will be based on the Companies Act definition, requiring two out of the following three criteria to be met.
  • Turnover of less than £25 million
  • Less than 250 employees
  • Gross assets less than £12.5 million
• If you are a ‘large’ business, you would need to demonstrate that the business has been adversely affected by COVID-19. No details have been provided yet about how this will be defined in practice.

For the employee …

• The employee must have been on their employer’s PAYE payroll on or before 23 September 2020 and an RTI submission must also have been made before that date.
• The employee must not have been served notice of redundancy before being placed on the Job Support Scheme.

Are there any conditions?

At the time of writing we are aware of the following conditions:

• No businesses will be able to make an employee participating in the scheme redundant (or issue notice of redundancy) whilst they are on the scheme.
• Employees can rotate on and off the scheme, but each rotation must be a minimum of seven days.

We await further details of the scheme to understand what, if any, additional conditions will be applied.

Some examples of how the scheme would work

To give employers an idea of how the scheme would work in practice, we have provided some examples below:

• Scenario One – half of normal hours available:

Jack normally works 40 hours a week for VHR Ltd for £2,000 per month. VHR Ltd currently only has 20 hours a week for Jack. Jack is therefore paid £1,000 per month for 20 hours worked per week.

He is then paid a total of £666.66 per month in respect of the 20 hours a week NOT worked (two thirds) £333.33 is paid by VHR Ltd plus £333.33 is claimed from the government. The missing £333.34 is what Jack must forego to make the scheme work. So, in this example, Jack gets 83.3% of his full normal pay for working 50% of his normal hours. 19.9% is paid by the government.

• Scenario Two – two thirds of normal hours available:

Elaine normally works 39 hours a week for VHR Ltd for £9,000 per month. VHR Ltd currently only has 26 hours a week for Elaine. Elaine is therefore paid £6,000 per month for her 26 hours worked per week.

She is then paid a total of £1,697.92 per month in respect of the 13 hours a week she doesn’t work. £1,000 is paid by VHR Ltd (one third) plus another £697.92 (i.e. the capped amount) is claimed from the government. The missing £1,302.08 is what Elaine must forego to make the scheme work. In this example Elaine gets 85.5% of her normal full pay for working 66% of the hours. 9% is paid by the government.

• Scenario Three – one third of normal hours available:

Ben normally works 30 hours a week for VHR Ltd for £1,500 per month. VHR Ltd currently only has 10 hours a week for Ben. Ben is therefore paid £500 per month for his 10 hours

worked per week. He is then paid a total of £666.66 per month in respect of the 20 hours a week he doesn’t work. £333.33 is paid by VHR Ltd (one third) and another £333.33 is claimed from the government.

The missing £333.33 is what Ben must forego to make the scheme work. In this example Ben gets 77.7% of his normal full pay for working a third of the hours. 28.5% is paid by the government.

• Scenario Four – 20% of normal hours available:

Janine normally works 40 hours a week for VHR Ltd for £3,000 per month. VHR Ltd currently only has 10 hours a week for Janine. Janine is therefore paid £750 per month for her 10 hours worked per week. No grant can be claimed as Janine is working less than a third of her normal contracted hours.