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Job Support Scheme

24th Sep 2020
Business, Coronavirus, Human Resources

Announced today the Job Support Scheme

The Chancellor Rishi Sunak today outlined additional government support through the Job Support Scheme to provide certainty to businesses and workers impacted by coronavirus across the UK.

Delivering a speech in Parliament, the Chancellor announced a package of measures that will continue to protect jobs and help businesses through the uncertain months ahead as we continue to tackle the spread of the virus. The package includes a new Jobs Support Scheme to protect millions of returning workers, extending the Self Employment Income Support Scheme and 15% VAT cut for the hospitality and tourism sectors, and help for businesses in repaying government-backed loans.

The announcement comes after the Prime Minster set out further measures to combat the spread of the virus over the winter, while preserving the ability to grow the economy.

The Chancellor of the Exchequer Rishi Sunak said:

“The resurgence of the virus, and the measures we need to take in response, pose a threat to our fragile economic recovery. Our approach to the next phase of support must be different to that which came before.  The primary goal of our economic policy remains unchanged – to support people’s jobs – but the way we achieve that must evolve.”

The Government has been consistently clear that it would keep its support under review to protect jobs and the economy, with today’s action reflecting the evolving circumstances and uncertainty of the months ahead. The package of includes a number of measures, which applies to all regions and nations of the UK, and we have focused on those affecting support for workers.

A new Job Support Scheme will be introduced from 1 November to protect viable jobs in businesses who are facing lower demand over the winter months due to coronavirus.

Under the scheme, which will run for six months and help keep employees attached to the workforce, the Government will contribute towards the wages of employees who are working fewer than normal hours due to decreased demand.

Employers will continue to pay the wages of staff for the hours they work – but for the hours not worked, the Government and the employer will each pay one third of their equivalent salary.

This means employees who can only go back to work on shorter time will still be paid two thirds of the hours for those hours they can’t work.

In order to support only viable jobs, employees must be working at least 33% of their usual hours. The level of grant will be calculated based on employee’s usual salary, capped at £697.92 per month.

The Job Support Scheme will be open to businesses across the UK even if they have not previously used the furlough scheme, with further guidance being published in due course.  It is expected that this new scheme will not be able to be used for employees who working under a notice of redundancy though we are waiting on confirmation of this element in the formal documentation to be released in the coming days.  As we learned from the announcements that launched the Coronavirus Job Retention Scheme  – the devil is in the detail!

It is worth noting that it is designed to sit alongside the Jobs Retention Bonus and could be worth over 60% of average wages of workers who have been furloughed – and are kept on until the start of February 2021. Businesses can benefit from both schemes in order to help protect jobs.

If you have concerns or HR related matters you would like support or advice on please contact the MAD-HR team today.

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