On Friday (again!), the Chancellor announced further financial support measures for businesses and employees. The Job Support Scheme that was announced to start on 1 November will be expanded to those business who are required to close their premises due to local or national coronavirus restrictions.
The government will pay two thirds of employees’ salary up to a maximum of £2,100 per month. Employers will not be required to contribute towards wages but will need to cover NICS and pension contributions.
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 seven 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 a 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 government have said that employers must agree the new scheme with the relevant staff, make any changes to the employment contract by agreement, and notify the employee in writing. This agreement must be made available to HMRC on request.
Early indications are that the government haven’t gone far enough as those businesses that are likely to close are in the hospitality industry with employees on close to minimum wage. Two thirds of minimum wage will cause serious financial hardship.
Whilst we await further detail, we advise that employers are at risk of a claim if they do not pay National Minimum Wage.
Get in touch with our HR Consultants and Employment Solicitors to discuss your situation!
