The Job Support Scheme(JSS) which was due to start on 1 November will now be delayed as the Prime Minister has announced a one-month extension to the CJRS to ensure furloughed employees continue to receive 80% of their wages.
The extended CJRS puts the level of support back up to August, when the government was contributing to 80% of wages.
What we know so far:-
- This extended CJRS will operate in the same way as the previous scheme, with businesses paid upfront to cover wages costs.
- The CJRS will be extended until December. The level of the grant will mirror levels available under the CJRS in August 2020 i.e. the government will pay 80% of wages up to a cap of £2,500 and employers will pay employer NICs and pension contributions only for the hours the employee does not work.
- As under the current CJRS, flexible furloughing will be allowed, in addition to full-time furloughing.
- Further details, including how to claim this extended support through an updated claims service, will be provided shortly.
- JSS will be introduced following the end of the CJRS.
Who is eligible?
Employers
- 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.
- The government expects that publicly funded organisations will not use the scheme, as has already been the case for CJRS, but partially publicly funded organisations may be eligible where their private revenues have been disrupted. All other eligibility requirements apply to these employers.
Employees
- strong>To be eligible to be claimed for under this extension, employees must be on an employer’s PAYE payroll by 23:59 30th October 2020. This means a Real Time Information (RTI) submission notifying payment for that employee to HMRC must have been made on or before 30th October 2020.
- Employees can be on any type of contract. Employers will be able to agree any working arrangements with employees.
- Employers can claim the grant for the hours their employees are not working, calculated by reference to their usual hours worked in a claim period. Such calculations will broadly follow the same methodology as currently under the CJRS.
- When claiming the CJRS grant for furloughed hours, employers will need to report and claim for a minimum period of seven consecutive calendar days.
- Employers will need to report hours worked and the usual hours an employee would be expected to work in a claim period.
- For worked hours, employees will be paid by their employer subject to their employment contract and employers will be responsible for paying the tax and NICs due on those amounts.
Support provided and employer costs:
- For hours not worked by the employee, the government will pay 80% of wages up to a cap of £2,500. The grant must be paid to the employee in full.
- Employers will pay employer NICs and pension contributions, and should continue to pay the employee for hours worked in the normal way.
- As with the current CJRS, employers are still able to choose to top up employee wages above the scheme grant at their own expense if they wish.
- The Government will confirm shortly when claims can first be made in respect of employee wage costs during November, but there will be no gap in eligibility for support between the previously announced end-date of CJRS and this extension.
If you would like help with your Payroll, please contact a member of our Payroll team on 01788 539000.