New 'Job Support Scheme' to Follow the End of Furlough
The Chancellor has announced a new 'Job Support Scheme' (New Scheme) under which the Government will top up the wages of workers, so that they can be paid for up to two-thirds of their working hours, for six months from November 2020.
The aim of the New Scheme is to bring people back to work, supporting what the Chancellor calls "viable" jobs. Under the New Scheme, workers will need to work at least one-third of their normal hours. Employers will be responsible for paying staff wages for the proportion of time staff spend working. For remaining hours not worked, the Government and the employer will each pay one-third of staff wages. According to the Treasury, this means employees working 33% of their usual hours will receive at least 77% of their pay. The Chancellor did not mention a cap on the Government's contribution under the New Scheme, but we anticipate details of this will follow in written guidance due to be issued shortly.
The Chancellor has also confirmed eligibility to participate in the New Scheme will be mainly limited to small- and medium-sized employers. Larger employers will need to demonstrate they have been adversely affected by coronavirus (COVID-19) in order to participate in the New Scheme. Further detail of eligibility criteria, including on the size of employers who can participate, are expected shortly.
The New Scheme will be open to all employees of eligible employers, even if they were not previously furloughed. The furlough scheme will come to an end as planned on 31 October 2020.
We will report further on the detail of the New Scheme once any draft legislation and guidance is published.