The government has put in place a job support scheme to replace the furlough scheme, but what should employers know about it? Read on to learn more.
For business owners and employees alike, the removal of the furlough scheme at October’s end was a concerning prospect. However, the government decided to replace it, when the number of cases of COVID-19 began to increase in the Autumn, with a new Job Support Scheme.
What Is The Job Support Scheme?
Coming into effect on 1st November 2020, the Job Support Scheme will last until 30th April 2021. This scheme is designed to permit the introduction of “short-time working” for employees. In practical terms, this means employers can bring workers back into the workplace for fewer hours than they would usually work. There is a caveat though. Employers have to give the employee at least a third of the usual amount of hours that they work for the employee to be eligible to receive support.
How Does The Job Support Scheme Work?
For any hours worked by the employee, employers have to ensure they receive full pay, but for each hour they don’t work, the government and employer will pay a third each of their typical pay. This means employees receive two-thirds of the typical amount of pay they would receive for any time when they’re not working. There is a cap on the government contribution of £697.92 each month. Should the cap not be applicable, employees can earn a minimum of 77% of the usual pay they receive for only working a third of their typical hours.
Who Can Benefit From This Scheme?
The scheme applies not only to workers who were on furlough and who are now returning to the workplace but also to currently working employees whose hours need to be reduced. All SMEs are automatically eligible for the scheme, but larger businesses only have eligibility if they can demonstrate they’ve significantly lost revenue due to the pandemic.
Do Any Special Conditions Apply To Businesses Using This Scheme?
There are a few conditions that businesses using the scheme must comply with. No business that utilises the scheme can make any employee who is receiving support redundant. Also, capital distributions cannot be made while a business is using this scheme.
Can Businesses Benefit From Both The Job Retention Bonus And Job Support Scheme?
An eligible business will be able to both receive job retention bonuses for their retained employees and claim support from the Job Support Scheme.
Must I Inform My Affected Employees About The Effect This Scheme Could Have On Them?
If employers intend to use this scheme they should think about writing to each potentially affected employee explaining the possible impact it could have on them going forward. It remains necessary to have an agreement on any changes that may take place to employees’ work patterns and salary entitlements before the scheme is implemented.