Changes to the Furlough Scheme from 1st November 2020
Monday 26th October, 2020
On October 22 the Chancellor Rishi Sunak unveiled changes to the Job Support Scheme that will replace furlough scheme from November.
To support individuals and businesses to deal with the challenges created by coronavirus (COVID-19) during this winter (2020 to 2021), the government is providing additional support to help employers retain their employees through the Job Support Scheme (JSS) . This was first announced by the Chancellor of the Exchequer on 24 September 2020.
Whilst some businesses have managed to return to levels of demand near to what they experienced before the start of coronavirus, or have found creative and innovative ways to adapt to the new economic reality, others continue to face challenges.
The Job Support Scheme provides different types of support to these businesses so they can get the right assistance, at the right time, according to their situation. Businesses that are operating but facing decreased demand can get support for wages through JSS Open. Those businesses that are legally required to close their premises as a direct result of coronavirus restrictions set by one or more of the four governments of the UK can get the support they need through JSS Closed.
This policy paper sets out details on eligibility criteria, conditions and timescales for making claims under the Job Support Scheme. Reflecting the different types of support being provided through the scheme, this paper details specific eligibility criteria for JSS Open and primary criteria for JSS Closed, followed by eligibility criteria and conditions for the whole scheme.
The employee will need to work a minimum of 20% of their usual hours and the employer will continue to pay them as normal for the hours worked. Alongside this, the employee will receive 66.67% of their normal pay for the hours not worked – this will be made up of contributions from the employer and from the government. The employer will pay 5% of reference salary for the hours not worked, up to a maximum of £125 per month, with the discretion to pay more than this if they wish. The government will pay the remainder of 61.67%, of reference salary for the hours not worked, up to a maximum of £1,541.75 per month. This will ensure employees continue to receive at least 73% of their normal wages, where they earn £3,125 a month or less.
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Further guidance will be available at the end of October 2020.