The Chancellor has this afternoon announced significant changes to the government’s Job Support Scheme for open businesses. The Chancellor has said that they are ‘making the Open Job Support Scheme more generous to protect jobs during lower demand’. Under the revised scheme, employers will pay in less and staff can work fewer hours before they qualify which will be welcome news for many organisations.
It has been announced that:
- The minimum hours employees will need to work as part of the qualifying criteria for the Open Job Support Scheme is 20% of their normal hours, the original requirement was 33%
- Originally employers were required to contribute 33% of the wages for the time that employees on the Open Job Support Scheme were not working. However, this will now be reduced to 5%, while the government’s contribution will increase to up to 61.67% of wages for hours not worked, up to £1541.75 per month.
- The Open Job Support Scheme will run for six months from 1 November 2020 and this increased support for employers will be reviewed in the new year.
Furthermore:
- All employers with a UK bank account and UK PAYE schemes can claim the grant, where the requirements are met. However, large employers (with 250 or more employees) will have to meet a financial impact test and fully publicly funded organisations are not expected to use the Open Job Support Scheme. Neither the employer nor the employee needs to have previously used the furlough scheme.
- Employees must be on an employer’s PAYE payroll between 6 April 2019 to 23:59 23 September 2020. This means a Real Time Information (RTI) submission notifying payment to that employee to HMRC must have been made on or before 23 September 2020.
- The employee must work at least 20% of their usual hours and they can undertake training in their working hours whilst being claimed for.
- Employees will be able to cycle on and off the scheme and do not have to be working the same pattern each month, but each reduced hours working arrangement must cover a minimum period of seven consecutive days.
- Grants will be payable in arrears, reimbursing the employer for the government’s contribution. This means that 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.
- Employers will be able to make a claim online through Gov.uk from 8th December 2020. They will be paid on a monthly basis. The grant will not cover Class 1 employer NICs or pension contributions, although these contributions will remain payable by the employer.
- Employees cannot be made redundant or put on notice of redundancy during the period within which their employer is claiming the grant for that employee.
- Employers must have agreed the temporary working arrangement for shorter hours in writing with employees.
- Employers using the Open Job Support Scheme will be able to claim the Job Retention Bonus if they meet the eligibility criteria.
The government has said that further guidance on the Open Job Support Scheme and the Closed Job Support Scheme (for businesses that are legally required to close their premises due to local or national coronavirus restrictions) will be published shortly. We will keep you updated on further developments. In the meantime, remember, it’s important to seek advice on the facts of your situation before taking action in relation to any employee.
If you have an employment law matter you would like assistance with, please do not hesitate to contact Kingfisher Professional Services Ltd.