Call 01383 631630

Specialist accounting and tax services for Consultants, Trades Professionals & Creative Companies

JSS and Lockdown Restrictions

By 16th October 2020

The Chancellor confirmed on 9th October, outlining that the new Job Support Scheme will be ‘expanded’ to protect jobs when employers are required to close their business due to Covid-19 restrictions – either local or national lockdown measures. This will apply across the UK .

The Job Support Scheme was initially established to only support those who are working fewer hours than normal; not those who are working no hours. For the first three months of the Job Support Scheme, employees must work for at least one third of their normal working hours after which this minimum threshold will be reviewed by the Government (at the three-month point).

However, the latest update from the government has expanded this, outlining that where businesses have been asked to close due to lockdown measures, and staff are therefore unable to work at all, the Government will also support employers who are eligible by paying two thirds of their employees’ salaries each (equivalent to 67%). This will be up to a monetary cap of £2,100 per month per employee – contrary to the £697.92 cap for businesses making use of the scheme but who have not been asked to close.

During lockdown periods, youwill not be required to contribute towards employees’ wages but will be asked to cover National Insurance Contributions (NICS) and auto-enrolment pension contributions only. The Government are estimating that approximately half of the potential claims under this Job Support Scheme expansion are not likely to incur NICS or pension contributions which means that some employers will not be faced with any employer contributions at all.

To be eligible for this expansion, employees must have been out of work for a minimum of at least 7 consecutive days as a result of lockdown restrictions. Whilst the scheme, including the expansion, will be reviewed in January 2021, it will begin on 1st November for a period of 6 months. Payments under the full scheme and the expansion will be made in arrears through HMRC’s claims service that will be available to claimants in December 2020.

Whilst on the topic of lockdown restrictions, the Government also announced last month that a new grant will be available for businesses across all industries who must close as a result of lockdown restrictions. The payment for this has been increased from up to £1,500 every three weeks to up to £3,000 per month every two weeks. It has been confirmed that the new Job Support Scheme and its expansion will be claimable alongside this new grant, as well as the Job Retention Bonus.

JSS and Lockdown Restrictions