Update 1 - Government announces New Job Support Scheme
On 24 September 2020, the Chancellor announced the new Job Support Scheme (JSS). The JSS will run for 6 months from 1 November 2020 and acts as a replacement for the current Coronavirus Job Retention Scheme (CJRS) which ends on 31 October 2020.
Although full guidance on the JSS is awaited (and is expected shortly), the Government has published a fact sheet with some brief details of how the JSS will operate.
The fact sheet can be viewed at the following link:
The fact sheet confirms:
- The JSS is designed to protect “viable jobs” in businesses who are facing lower demand over the winter months due to Covid-19, to help keep their employees attached to the workforce. There is currently no detailed guidance on what amounts to a “viable job” although the fact sheet confirms that employees cannot be made redundant or given notice of redundancy during the period for which their employer is claiming the grant for them.
- Under the JSS, the employee must work a minimum of 33% of their normal working hours. The employer will continue to pay its employee for time worked, but the burden of hours not worked will be split between the employer and the Government (through wage support) and the employee (through a wage reduction).
- For any time worked, employees must be paid their normal contractual wage. For time not worked, the employee will be paid up to two-thirds of their usual wage. For every hour not worked, the Government and employer will each pay a third of the employee's usual hourly wage (the Government's contribution being capped at £697.92 a month). Employees who have previously been furloughed will have their usual pay and/or hours used to calculate usual wages, not their furlough pay. This means that employees using the JSS will earn a minimum of 77% of their normal wage (where the Government’s contribution is not capped).
- Employers using the JSS will also be able to claim the Job Retention Bonus if they meet the eligibility criteria.
- All employers with a UK bank account and UK PAYE schemes can claim the grant. Neither the employer nor the employee needs to have previously used the CJRS. Large businesses will have to meet a financial assessment test, so the scheme is only available to those whose turnover is lower now than before experiencing difficulties due to Covid-19. Small and medium size businesses will not be subject to financial assessment.
- To be eligible, an employee must be on their employer's PAYE payroll on or before 23 September 2020 (meaning that a Real Time Information submission notifying HMRC of payment to that employee must have been made on or before that date).
- For the first three months of the scheme, an employee must work at least 33% of their usual hours. After three months, the Government will consider increasing this threshold. Employees will be able to "cycle on and off the scheme" and will not have to work the same pattern each month, but each short-time working arrangement must cover at least seven days.
- The JSS grant will not cover Class 1 employer NICs or pension contributions which will remain payable by the employer. Calculation of "usual wages" will follow a similar method to the CJRS.
- The fact sheet states "our expectation is that employers cannot top up their employees' wages above the two-thirds contribution to hours not worked at their own expense" is unclear. It may acknowledge that employers cannot afford to do so but it may be a prohibition. This is likely to be covered in further guidance.
- Employers must agree the new short-time working arrangements with their staff, make any changes to the employment contract by agreement and notify the employee in writing. This agreement must be made available to HMRC on request. The agreements will be similar in nature to flexible furlough agreement. We can provide you with an agreement to use.
- Grants will be payable monthly in arrears after payment to the employee has been made and reported via an RTI return. Claims can be made online through GOV.UK from December 2020.
We will update this note when further guidance becomes available.
Update 2 – The Health Protection (Coronavirus, Restrictions) (Self-Isolation) (England) Regulations 2020
These new Regulations came into force at midnight on Sunday 27 September 2020 (in England only). The Regulations set out various rules in relation to self-isolation following a positive test for Covid-19.
The most important aspect of the new Regulations for employer appears in Regulation 7 and relate to workers who are required to self-isolate following a positive Covid-19 test. It is now an offence for an employer to knowingly permit a worker (including an agency worker) to attend any place other than where the individual is self-isolating. This includes worker who are required to self-isolate because they live with someone who has tested positive.
This means that if an employer knows a worker has tested positive (or lives with someone who has tested positive), it is now responsible for stopping the worker from working (unless they can work from home). Any employer who fails to do so will face a fine, starting at £1,000.
There is also an obligation on the worker to tell their employer that they are self-isolating. Any individual who breaches self-isolation will, normally, commit a separate criminal offence.
Employers may need to consider updating policies or implementing new policies to cover arrangements relating to periods of self-isolation.
Taylor Walton’s employment team is available to assist employers with matters relating to reopening the workplace including risk assessments, preparation of policy documents and communications with employees. If you have any queries relating to the issues raised in this guidance note, please contact Alec Colson in the first instance on 07711 589574 or firstname.lastname@example.org.