Job Support Scheme to replace furlough to help people in viable jobs will run for six months

Time 1 year ago

Rishi Sunak confirmed today (Sep 24) that furlough would end – to be replaced by a Job Support Scheme.

Addressing the House of Commons at lunchtime, the chancellor said the grant scheme would see the government ‘directly support’ the wages of people in viable jobs at firms facing lower demand than usual.

They must also be working at least a third of their normal hours. Here are the details.

When does it begin?
November 1, 2020 – the day after the end of the furlough scheme.

How long will it run for?
Six months.

How will it work?
Employers will carry on paying the wages of staff for the hours they work. For the hours that aren’t worked, the government and the employer will each pay a third of the equivalent salary.

It means that staff working a third of their hours will get at least 77 per cent of their pay and keep their jobs.

What’s the maximum grant payable?
The level of grant will be calculated based on the employee’s usual salary, and will be capped at £697.92 per month.

Which businesses will benefit?
The Job Support Scheme will initially be aimed at small and medium-sized businesses but could be extended to large firms if they were in dire need.

Is it just for firms that have put people on furlough?
No, it’s open to firms across the UK.

What about self-employed workers?
Similar support is being provided for the self-employed.

The Self-Employment Income Support Scheme (SEISS) will be extended to April 30, 2021. This will help viable traders that are facing less demand, with a government grant covering 20 per cent of their average monthly trading profits.

A taxable grant will be provided to those currently eligible for SEISS and who are continuing to actively trade but face a drop in demand because of coronavirus.

The initial lump sum will cover three months’ worth of profits from November to the end of January 2021. It’s worth a fifth of average monthly profits, up to a total of £1,875.

In addition, a second grant, which might be adjusted if circumstances change, will be available for self-employed people to cover the period from February 2021 to the end of April 2021.

What’s the position regarding redundancy?
Businesses won’t be allowed to issue redundancy notices to employees who are in the Job Support Scheme, nor will the scheme apply to people who are on redundancy notice.

Is the Jobs Retention Bonus affected?
No. Sunak said that employers who kept furloughed staff on shorter hours could claim both the Job Support Scheme and Jobs Retention Bonus. It could be worth more than 60 per cent of the average wage of workers who have been furloughed and are retained until the start of February 2021.

The measures announced today replace the autumn Budget, which was due to be delivered in November but was cancelled yesterday (Sep 23) by Sunak.

He commented that the government couldn’t save every business and every job but vowed it would address the problems being faced by businesses now.

Sunak added that his top economic priority was to protect people’s jobs.

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In a special edition of Car Dealer Live today (Sep 24), Lawgistics solicitor Nona Bowkis and ASE Global chairman Mike Jones discussed the new measures with host James Batchelor. Click on the main image to watch the video.

Short-term working scheme could replace furlough to help stave off more job losses in car industry

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John has been with Car Dealer since 2013 after spending 25 years in the newspaper industry as a reporter then a sub-editor/assistant chief sub-editor on regional and national titles. John is chief sub-editor in the editorial department, working on Car Dealer, as well as handling social media.

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