The Job Support Scheme options – open and closed

The revised Job Support Scheme (JSS) announced in the last few days comes in two varieties: Open and Closed.

JSS Open

Businesses in Tier 2 areas, that suffer the restrictions to sociability rules, never-the-less are not required to close. This is an insidious outcome for these traders, particularly those in the hospitality sector, as they may not be able to generate enough income to make their businesses financially viable.

One option available to these concerns was to lay-off staff.

To counter this, the Chancellor has now made two significant changes to his JSS scheme:

  1. As long as an employee can work a minimum 20% of normal working hours (previously this was 33%) they can be funded by the JSS. Employers will pay for these worked hours.
  2. Employees will also receive two-thirds of pay for normal hours not worked. Government will fund 61.67% and employers 5%. Previously, the employer’s contribution was one-third.

There is a cap to employer and employee contributions under this JSS Open initiative. They are:

  • Employer’s contributions are capped at £125 per month with the discretion to pay more if they wish, and
  • Government’s contribution will be capped at £1,541.75 per month.

Employees that are placed in this JSS Open scheme will also have the option to claim Universal Credits if their reduced earnings are insufficient to meet outgoings and they otherwise qualify.

 

JSS Closed

Businesses required to close by any of the four UK governments will have the option to claim under the so-called JSS Closed scheme. The key phrase here is “required to close”.

Eligible businesses will be able to claim as follows:

  • Employees who cannot work due to government restrictions will receive two thirds of their normal pay, paid by employer, and fully funded by government to a maximum £2,083.33 per month. Employers still retain the option to pay more if they wish.
  • Employees can also apply for Universal Credits if they qualify for this additional support.

Cash-flow issue

Both schemes, Open and Closed, will run from 1 November 2020 for six months. Employers should note that you will not be funded by the JSS when payments to employees are made. Claims will be processed and paid to employers in the month following a claim period.

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