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Coronavirus Job Retention Scheme

Under the Coronavirus Job Retention Scheme, all UK employers will be able to access support to continue paying part of their employees’ salary for those employees that would otherwise have been laid off during this crisis.

What support is available under the Job Support Scheme?

There are two versions of the Job Support Scheme (JSS):
  1. JSS Open – Where the business remains pen but there is decreased demand.
  2. JSS Closed – Where a business has been legally required to close as a direct result of coronavirus restrictions. 

JSS Open:

This scheme will replace the Job Retention Scheme (Furlough Scheme) on November 1st 2020 for 6 months initially to April 2021.  

It is a scheme that supports short time working hours where employers can agree with staff for them to work fewer hours per week (working a minimum of 20% of their normal hours). Employees will be paid by their employers at their usual rate for the hours worked. For hours not worked, the employer will pay 5% of the reference salary up to a maximum of £125 per month with the option to top up if they wish. The Government will pay 61.67% of the reference salary for hours not worked up to a maximum of £1,541.75 per month. Therefore, affected employees will receive at least 73% of their normal wage where they earn £3,125 per month or less. 

Eligibility

Employers
  • All small and medium size 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 Coronavirus Job Retention Scheme.
  • Larger businesses (confirmed as those who employ 250 employees or more) will have to meet a financial assessment test but may still be eligible. 

Employees
  • Employees must be on an employer’s PAYE payroll on or before 23rd September 2020. This means a Real Time Information (RTI) submission notifying payment to that employee to HMRC must have been made on or before 23rd September 2020.
  • For the purposes of the scheme, an individual is an employee if they are treated as an employee for Income Tax purposes. 
  • Employees will be able to cycle on and off the scheme and do not have to be working the same pattern each month, but each short-time working arrangement must cover a minimum period of seven days.

Other important information:
  • Grant payments will be made in arrears and be available from 8th December 2020, reimbursing the employer for the Government’s contribution. 
  • Employers must have reached written agreement with their employee (or reached written collective agreement under a collective agreement). This agreement should be retained for 5 years and be available for view if requested by HMRC. 
  • Employers using the Job Support Scheme will also be able to claim the Job Retention Bonus if they meet the eligibility criteria. 
  • The grant will not cover Class 1 employer NICs or pension contributions. These contributions will remain payable by the employer.
  • HMRC will check claims. Payments may be withheld or need to be paid back if a claim is found to be fraudulent or based on incorrect information.
  • Employees are permitted to undertake voluntary training in non working hours. Where time spent on training attracts a wage entitlement in excess of the grant, employers will need to pay the difference. 
  • The JSS will not affect Working Tax Credit. 
  • Employers cannot claim for an employee who has been made redundant or who is on statutory notice of redundancy.


JSS Closed

This applies to companies that are required to:
  • ‘legally’ shut down as the result of a local or national lockdown; and 
  • employees are off work for a minimum of seven consecutive days.
In this case the employer can claim a temporary grant whilst the restrictions are in place. This grant is two-thirds of each employees’ salary and is capped at £2,083.00 per month which is payable in arrears. 

The scheme starts on 1 November 2020 for a period of six months but will be reviewed in January 2021

Grants must only be reimbursement for wage costs actually paid to the employees and the whole of the grant obtained must be paid on to the employees. 

Employers do not have to contribute to these wage costs, unlike the general job support scheme which requires them to contribute. Employers must still pay employer’s NI and pension contributions themselves. However, employers could top up employees’ pay if they choose to. 
  • Employers must have reached written agreement with their employee (or reached written collective agreement under a collective agreement). This agreement should be retained for 5 years and be available for view if requested by HMRC. 
  • Employers cannot claim for an employee who has been made redundant or who is on statutory notice of redundancy.

Salary Reference for the JSS (Open and Closed)

Employers should base calculations on the regular payments they are obliged to make, Including:
  •  Regular wages
  •  Non-discretionary payments for hours worked, including overtime
  •  Non-discretionary fees
  •  Non-discretionary commission payments
  •  Piece rate payments

Calculations should not include:
  •  Any discretionary payments
  •  Tips (including those distributed through troncs)
  •  Non-cash payments
  •  Non-monetary benefits like benefits in kind. 

Reference Salary - Fixed Pay

For employees on a fixed salary, the Reference Salary is the greater of:

  •  The wages payable to the employee in the last pay period ending on or before 23rd September 2020
  •  The wages payable to the employee in the last pay period ending on or before 19th March 2020.

Reference Salary – Variable Pay

For employees on variable pay, the Reference Salary is the greater of:
  •  The wages earned in the same calendar period in the tax year 2019 to 2020.
  •  The average wages payable in the tax year 2019 to 2020
  •  The average wages payable from 1st February 2020 (or the employees start date if later) until 23rd September 2020. 


Other Frequently Asked Questions:


Q: What is the Job Support Bonus and who can we claim for under the Job Support Bonus?

The Job Retention Bonus is a £1,000 one-off taxable payment to you (the employer), for each eligible employee that you furloughed and kept continuously employed until 31 January 2021.

You’ll be able to claim the bonus between 15 February 2021 and 31 March 2021. You do not have to pay this money to your employee.

You can still claim the bonus if you make a claim for that employee through the Job Support Scheme.

To be eligible for the bonus you must make sure that your employees have been paid at least the minimum income threshold.
To meet the minimum income threshold, you must pay your employee a total of at least £1,560 (gross) throughout the tax months:
  • 6 November to 5 December 2020
  • 6 December 2020 to 5 January 2021
  • 6 January to 5 February 2021
You must pay your employee at least one payment of taxable earnings (of any amount) in each of the relevant tax months.

Q: Is there any financial support for individuals in areas with high incidence of COVID-19 who can’t work from home but are required to self-isolate?

The Government have confirmed a Test and Trace Support payment scheme in certain areas affected by local lockdowns paying £500 to both employed and self-employed people on low incomes who are required to self-isolate from 28 September. 

The scheme will only support people who are asked to self-isolate by NHS Test and Trace.

To be eligible for support payment the person must live in England and:
  • have been asked to self-isolate by NHS Test and Trace
  • cannot work from home and will lose income as a result
  • be claiming at least one of the following benefits: universal credit, working tax credit, income-related employment and support allowance, income-based jobseeker’s allowance, income support, pension credit or housing benefit.
The payments under this scheme are:
  • £130 for those who have tested positive for coronavirus and have to self-isolate for 10 days.
  • £182 for qualifying members of an infected person's household who have tested positive for coronavirus and are asked to self-isolate for 14 days.
  • £13 per day (up to the maximum of £182) if an individual is identified as a non-household contact of another person who has tested positive for coronavirus and is asked to self-isolate for up to 14 days.
The self-isolation days are measured either from the point the person first developed symptoms, or from when they were most recently in contact with the person who tested positive. 

The payments will not reduce any other benefits.

Q: What happens if an employee needs to self-isolate?

The Government announced measures which entitles employees who have coronavirus, or who cannot work because they are self-isolating to Statutory Sick Pay (SSP) from day one. 

This includes individuals who do not have symptoms, and those in the same household as others who display symptoms and are following government public health advice to self-isolate. The scheme has been extended to cover those instructed to self-isolate by the NHS test and trace service (see above).

Employers with 250 employees or less can recover two weeks of SSP paid to employees for absences due to coronavirus from 13 March 2020 onwards. 

Q: What happens if an employee contracts Coronavirus??Do they still get full pay or sick pay?
If an employee contracts Coronavirus, this should be treated in the same way as any other sickness absence in terms of payment. If the employer normally only pays statutory sick pay (SSP) during sickness absence, then this is what the employee should receive 

Q: If an employee was asked to self-isolate or has Coronavirus, would it breach privacy to communicate this to the rest of the employees?
Employers must communicate this to employees. Employers have a duty of care and data protection regulations do not prevent employers honouring their duty to the health and safety of all employees or sharing data with authorities for public health purposes. 

You should avoid naming individuals if possible and you should not provide more information than is necessary.

Please contact us on  01384 563 050 or email enquiries@streamhr.co.uk  should you have any questions or require any support on this topic or in any other areas of HR. 




Statutory Sick Pay Refund

The Coronavirus SSP Rebate Scheme is open for applications. The scheme covers staff SSP payments for up to two weeks of sickness absence when the absence is related to the coronavirus outbreak. Any additional, contractual sick pay is not included.

The eligibility criteria for the scheme will be as follows:
  • this refund will cover up to 2 weeks’ SSP per eligible employee who has been off work because of COVID-19 on or after 13th March 2020 employers with fewer than 250 employees will be eligible - the size of an employer will be determined by the number of people they employed as of 28 February 2020
  • employers will be able to reclaim expenditure for any employee who has claimed SSP (according to the new eligibility criteria) as a result of COVID-19
  • employers should maintain records of staff absences and payments of SSP, but employees will not need to provide a GP fit note. If evidence is required by an employer, those with symptoms of coronavirus can get an isolation note from NHS 111 online and those who live with someone that has symptoms can get a note from the NHS website
  • eligible period for the scheme will commence the day after the regulations on the extension of SSP to those staying at home comes into force
  • the government will work with employers over the coming months to set up the repayment mechanism for employers as soon as possible
  • the current rate of SSP is £95.85 per week (£94.25 prior to 6th April 2020)
The Scheme covers any members of staff who were on a PAYE payroll scheme created and started before 28 February 2020. This includes:
  • full-time employees
  • part-time employees
  • employees on agency contracts
  • employees on flexible or zero-hour contracts
Furloughed staff are not included and should not be receiving SSP. Employers can furlough their employees who have been advised to shield in line with public health guidance and are unable to work from home. Where an employee has been notified to shield and has not been furloughed, the rebate will compensate up to 2 weeks of SSP from 16 April 2020

Is your business eligible?

Businesses are eligible for the scheme if:

  • they are UK based
  • the business is a small or medium-sized and employs fewer than 250 employees as of 28 February 2020

Answers to frequently asked questions

  • Employers are free to switch employees from sick pay to furlough
  • Employers of newly TUPE’d employees can put them on furlough
  • Employers can furlough ‘shielding’ employees
  • Employers can claim through the scheme for enhanced maternity pay
  • Employers can furlough employees unable to work because of care responsibilities arising as a result of coronavirus
  • Holidays can be taken during a period of furlough and must be paid at full pay
  • Employers can require employees to take holiday during a period of furlough as long as they give the required notice
  • Where it has not been reasonably practicable for the worker to take some or all of the 4 weeks’ holiday due to the effects of coronavirus, the untaken holiday may be carried forward into the following 2 leave years. When calculating how much holiday a worker can carry forwards, employers must give workers the opportunity to take any leave that they cannot carry forward before the end of the leave year.



Last Updated: 29 Oct 2020 4:52 PM