The end of October brings the end of the Coronavirus Job Retention Scheme (‘CJRS’), the unprecedented package of support that at its peak subsidised wages for around 30% of the workforce throughout the UK, and as of September 2020 cost close to £40 billion and counting.
The end of the Scheme will not mark the end of the Government’s financial support for businesses however, as it is to be replaced by the Job Support Scheme (‘JSS’) from 1 November 2020. This new scheme has been deemed less generous than the furlough scheme and reflects the Government’s stark realisation that it will not be possible to save all jobs and businesses that have been affected by the pandemic.
The scheme is split into two limbs, JSS Open and JSS Closed, and below we take a brief look at what each scheme entails.
JSS Open was originally announced back in September as the successor of the CJRS. Under this scheme the Government will continue to subsidise wages for employees provided they are working at least 20% of their normal hours. The employer will be expected to pay as normal for the hours that are actually being worked, plus a little extra equalling 5% of the ‘lost hours’.
The Government will then pay for 61.67% of the hours not worked, up to a maximum of £1,541.75. This means if an employee normally earns £3,125 or less each month then they will continue to receive at least 73% of the normal wages whilst on the scheme. Employers will still be expected to pay national insurance and pension contributions as normal.
JSS Closed has been announced as support for businesses that are legally required to close as a result of Coronavirus restrictions. If a business is required to close for at least seven consecutive days, the Government will pay two-thirds of an employee’s normal wages up to a maximum of £2,083.33 per month.
The aim of this limb of the scheme is to protect incomes, limit unemployment, and enable premises to reopen as quickly as possible as soon as restrictions are lifted.
Everyone had hoped that by the end of October when the CJRS was drawing to a close that we would be over the worst of the pandemic and that would be the end of the support required. Sadly, this has not turned out to be the case. If you would like to read more about the JSS scheme and other financial support measures the Government have implemented to support the economy through the coming winter months, please see our more detailed article here.