Job Support Scheme announced today

The update to this article can be seen here.

The Chancellor has announced a new ‘Job Support Scheme’ supporting wages of those in work so employees can keep their jobs on shorter hours rather than be made redundant. The devil will be in the detail when the legislation and Government guidance is officially published, but headline points announced today are as follows:

1. The Job Support Scheme will directly support businesses and give them the option of keeping employees in their jobs on shorter hours rather than making them redundant.
2. The Scheme will support viable jobs so employees must be working at least one-third of their normal hours and be paid for that work, as normal, by their employer.
3. It will not cover employees still unable to perform any work, including from home.
4. The Government, together with employers, will cover two-thirds of the wages employees have lost by having their working hours reduced.
5. Running November to April, all SME’s are eligible to apply. Larger businesses will only be eligible where their turnover has fallen below a certain level.
6. Businesses are eligible even if they have not previously used the furlough scheme.
7. Employers retaining furloughed staff on shorter hours can claim both the Jobs Support Scheme and the Jobs Retention Bonus. This is intended to significantly increase the incentives to bring back previously furloughed employees.
8. The self-employed grant is being extended on similar terms to the new Job Support Scheme.
9. Coronavirus business interruption loans are being extended allowing more time to repay. To assist businesses with cash flow in terms of repaying their loans, repayments will be based on a ‘pay as you grow’ basis. Interest only repayments will be permitted on loans without credit ratings being affected.
10. Businesses will be able to defer their tax bills with no interest to repay.
11. Additional support will be afforded to the hospitality and tourism industries that require it with VAT increases being delayed until 31 March 2021.

Further information will be provided once the relevant legislation and guidance documents are published.

Should you have any queries on the above or require any employment related advice, please contact Fiona Mendel at fiona.mendel@seddons.co.uk or on 020 7725 8033 or Head of Employment, Helen Crossland at helen.crossland@seddons.co.uk or on 020 7725 8034.