The Chancellor has announced the launch of a new COVID-19 Job Support Scheme, following the end of the UK furlough scheme in October.
The new Scheme will run for six months starting in November 2020, following the end of the current furlough scheme. Those who used the furlough scheme will be able to claim the job retention bonus and also support from the Job Support Scheme.
Jobs Support Scheme
Under the Job Support Scheme, the UK Government will subsidise the pay of employees who are working fewer than normal hours due to lower demand. For a business to claim for a workers’ wages, the employee must work at least a third of their normal working hours and be paid as normal for these hours by their employer. For the hours employees can’t work, the government and the employer will each cover one third of the lost pay.
- Employee works 33% of their hours
- Of the 67% of hours left:
- UK Government will pay 22% of the employees’ wages
- Employer will pay 22% of employees’ wages
- = Employee receives no less than 77% of their wages
The grant will be capped at £697.92 per month, and all small and medium sized businesses will be eligible for the scheme; larger business will be eligible if their turnover has fallen during the crisis.
It will be open to employers across the UK even if they have not previously used the furlough scheme and it will run for six months starting in November through to the end of April 2021.
More details will be released in due course.
Support for the self-employed
The Chancellor will also extend the Self-Employed Income Support Scheme on similar terms to the Jobs Support Scheme. A grant will be available to those eligible for the Self Employment Income Support Scheme Grant that will cover three months’ worth of profits for the period from November to the end of January 2021. It will cover 20% of average monthly profits up to a total of £1,875. A further grant will be available to the self-employed to cover February 2021 to the end of April 2021.