Last week the government announced changes to the new job support scheme (JSS).  As before, the scheme opens on 1 November and will run for six months until April 2021.

Full details of the original scheme remained unpublished but, as with the old scheme, all SMEs are eligible to apply to the JSS regardless of which tier of lockdown restrictions they fall under. The changes appear to have been designed to address the gap in support for businesses in tier two restrictions, compared with those forced to close in tier three that will benefit from the extended furlough scheme.

The revised scheme is also open for larger companies that can show their turnover has been affected by the pandemic, although it is still unclear how this will be measured.

Claims cannot be submitted until December, so employers will have to pay employees, then wait to be reimbursed. The scheme is due to end on 30 April 2021.

Under the revised new scheme, employers will only be required to provide 5 per cent of lost wages for the time employees are not working, compared to 33 per cent under the old scheme.

The government is now increasing its contribution to 62 per cent to compensate for this, and has doubled its contribution cap to £1,541.75. Similarly, the minimum number of hours an employee needs to work to be eligible for the scheme has been reduced to 20 per cent of their regular hours, down from 33 per cent.

In effect, this will reduce the cost of keeping on a 'typical' furloughed worker from £233 a month to just £35 a month.

The monthly cost of retaining two employees, earning £17,000 a year, at half their normal hours is now just £100 more than keeping one full-time employee – down from £500 under the old scheme.

It's likely that the online claims system will resemble the mechanism for claims under the job retention scheme.

Full guidance on the exact mechanics of the repayment system is yet to be released, but the government has confirmed that further guidance will be published soon.

This article has been produced for general information purposes and further advice should be sought from a professional advisor. Please contact our  Employment Team at Cleaver Fulton Rankin for further advice or information.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.