The Chancellor of the Exchequer, Rishi Sunak has announced on Friday 9th October 2020 that the Government’s Job Support Scheme will be expanded to firms required to close due to covid restrictions.
- Job Support Scheme will be expanded to support businesses across the UK required to close their premises due to coronavirus restrictions
- The government will pay two-thirds of employees’ salaries to protect jobs over the coming months
- Cash grants for businesses required to close in local lockdowns also increased to up to £3,000 per month
What additional support can a business get?
Under the expansion, firms whose premises are legally required to shut for some period over winter as part of local or national restrictions will receive grants to pay the wages of staff who cannot work – protecting jobs and enabling businesses to reopen quickly once restrictions are lifted.
What is the eligibility criteria?
The Government will support eligible businesses by paying two-thirds of each employees’ salary (or 67%), up to a maximum of £2,100 a month.
Under the scheme, employers will not be required to contribute towards wages and only asked to cover NICS and pension contributions, a very small proportion of overall employment costs. It is estimated that around half of potential claims are likely not to incur employer NICs or auto-enrolment pension contributions and so face no employer contribution.
How does it work?
Businesses will only be eligible to claim the grant while they are subject to restrictions and employees must be off work for a minimum of 7 consecutive days.
The scheme will begin on 1 November and will be available for six months, with a review point in January. In line with the rest of the JSS, payments to businesses will be made in arrears, via an HMRC claims service that will be available from early December. Employees of firms that have been legally closed in the period before 1 November are eligible for the CJRS.
The scheme is UK wide and the UK Government will work with the devolved administrations to ensure the scheme operates effectively across all four nations.
This comes alongside intensive engagement with local leaders today on potential measures are coming in their areas.
In addition to the expansion of the JSS, the government is increasing the cash grants to businesses in England shut-in local lockdowns to support with fixed costs. These grants will be linked to rateable values, with up to £3,000 per month payable every two weeks, compared to the up to £1,500 every three weeks which was available previously. This could benefit hundreds of thousands of businesses, including restaurants, pubs, nightclubs, bowling alleys and many more.
The devolved administrations in Scotland, Wales and Northern Ireland will benefit from a £1.3bn increase to their guaranteed funding for 2020-21 – allowing them to continue their response to Covid-19 including through similar measures if they wish.
These measures will sit alongside the original JSS – which is designed to support businesses that are facing low demand over the winter months – and the £1,000 Job Retention Bonus (JRB) which encourages employers to keep staff on payroll.
When will this be in place?
There will be an announcement on Monday 12th October on how a new tiered system will be put in place rather than a full national lockdown.
We will update as more information becomes available.
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