The Job Support Scheme has been changed to increase government support and reduce the amount employers have to pay.
The scheme starts on 1 November 2020. When a business is experiencing difficulty keeping staff on, due to coronavirus, the Job Support Scheme can be used to help pay their wages.
What has stayed the same?
The employee will be paid for all of the hours they have worked and 67% of the hours not worked.
Businesses that have to close because of Tier 3 lockdowns can continue to access even greater funding. For these businesses, the Government will pay 67% and the employer does not need to contribute.
In all cases, the employer remains responsible for employer’s National Insurance and pension contributions.
What has changed?
The minimum hours worked has been reduced to 20% (it was going to be 33%).
The Government will now pay 62% of the hours not worked and the employer will pay 5% (was going to be 33% and 33%).
So, who pays what?
The amount of support changes depending on how many hours an employee works.
The Job Support Scheme will pay different amounts depending on the hours worked
An example
This example shows how much an employee, who normally earns £1,000, would get if they can only work one day a week instead of five.
- The employee is paid £200 by the employer for the time they have worked (was £330)
- The employer must pay an additional £40 – that is 4% of their normal pay (was £220)
- The Government will pay £496 – 49.6% of their normal pay (was £220)
- The amount not paid will be £264 – which is 26.4% of their pay (was £220)
Employees can end up receiving less pay
Because the minimum hours has been reduced from 33% to 20% , an employee who is kept on working at the bare minimum hours would be worse off under the revised scheme. If the employee is given 33% of their normal hours, they are no worse off.