WORKERS will have to do a minimum of 20% of hours as part of changes to make the Job Support Scheme more generous.
Chancellor Rishi Sunak announced the changes to the support package in the Commons today.
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The government will pay 61.67% of employee wages if they're enrolled on the scheme, while businesses will pay just 5%.
Before, the rules stated that employees on the scheme have to work a minimum of 33% of their hours to be eligible, and businesses must contribute a third of wages.
Currently, only companies in Tier 3 that are forced to close have access to the JSS that sees the government pay two thirds of their workers’ wages.
The state pays 22 per cent of the wages of staff under the scheme in all other areas of the country and they must be working at least a third of their normal hours.
Today the Chancellor announced:
- The Job Support Scheme which replaces the furlough scheme at the end of the month is made more generous
- Workers must work a minimum of 20% of hours to get help
- Businesses will pay just 5% of wages for hours not worked – down from around 22%
- Grants for self-employed people raised up to £3,750
- New grants for businesses in high-alert areas in Tier 2 and 3
Grants for self-employed workers will also double to cover 40% of previous earnings, up to £3,750, and new grants for businesses in high alert areas.
Mr Sunak said: "I’ve always said that we must be ready to adapt our financial support as the situation evolves, and that is what we are doing today.
"These changes mean that our support will reach many more people and protect many more jobs.
"I know that the introduction of further restrictions has left many people worried for themselves, their families and communities.
"I hope the government’s stepped-up support can be part of the country pulling together in the coming months."
It will be the second major amendment the Chancellor has made to the JSS since is was announced last month.
The JSS will replace furlough from November 1. Here's everything we know about it so far:
What extra help as been announced today?
The bumper package announced today is more generous for businesses that remain open in areas where there are tougher lockdown restrictions.
It will particularly help pubs, bars, restaurants and their workers in areas under Tier 2 restrictions, which are classed as ‘High Alert’ Covid hotspots.
When the Chancellor first announced the JSS as part of his Winter Economy Plan last month, employers had to cover 55% of overall wages with employees working a minimum of a third of their contracted hours.
The minimum number of hours employees have to work has today been lowered to a fifth of their contracted hours.
So now, employers will have to pay for a minimum of 20% of an employees usual hours, plus 5% of those hours not worked.
The government will now fund 62% of wages for the hours that are not worked, up to £1,541.75.
This is up from a third previously announced, which was to be capped at £697.92 per month.
He also revealed huge new grants of up to £2,100 for hospitality businesses that remain open in Tier 2 and 3 which face the toughest restrictions.
These can be backdated if they have been under new rules for months.
That is on top of the up to £1,500 grants firms can already claim if they are forced to close.
What is the Job Support Scheme?
The Chancellor announced that the furlough scheme will be replaced by the JSS from November 1.
Initially it was only open to employees who are working fewer than normal hours due to decreased demand and will see workers paid two thirds of their salary for the hours they can't work.
Employers will continue to pay staff for hours that they work – but for the hours they've not worked the government and employer will pay one third of their equivalent salary.
In total, someone on the scheme will receive 77% of their total pay, according to The Treasury.
The government's chunk of the support will be capped at £697.92 per month.
To be eligible, employees must be working at least a third of their contracted hours.
Employees are allowed to work more but the amount the government will pay is reduced.
For example, an employee working half of their normal hours will receive 83% of their total pay packet.
The government will cover 17% of their normal wages, while the employer will pick up 67%.
Anyone who is in employment as of September 23 can be put on the scheme – and it's open to all small and medium-sized businesses who didn't apply to furlough before.
Who else does the scheme support?
The scheme was extended on October 10 to include extra support for employees working for a business that has been ordered to close under local lockdown restrictions.
The government will pay two thirds – up to £2,100 a month – of staff wages if their work has been shut down.
Employers will only be required to pay workers' National Insurance and pension contributions. They can choose to top up wages but they don't have to.
Mr Sunak said the scheme is "more generous" than the furlough scheme, which currently sees the state cover up to 60% of employees wages, capped at £1,875 a month.
Employers are expected to contribute 20% of furloughed staff salaries, as well as NI and pension contributions.
But the government won't cover as much of employees wages as it did when the furlough scheme first launched, which was set at 80% up to £2,500 a month.
Restaurants and pubs that have been restricted to just offering takeaways will also be able to take advantage of the help.
Employees can't work or volunteer for their employers while on the scheme but they can work or volunteer for another business of charity.
Once lockdown restrictions are lifted, workers can then be rolled onto the first part of the Job Support Scheme if employers can't offer them their full contracted hours due to decreased demand throughout winter.
Workers will also need to have been on the RTI payroll on September 23 to qualify.
An RTI is sent from employers to HMRC, typically on payday.
Members of staff who'd started a new job before the deadline but were yet to receive their first pay cheque are excluded from the scheme.
The same loophole left thousands of "eligible" workers unable to be furloughed.
The scheme will run for six months and be reviewed after three.
Here we explain what financial support available to you if you have to self-isolate due to coronavirus or there's a local lockdown.
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