Coronavirus

In anticipation of harsher restrictions, which could be in place as early as next week in parts of England, the Chancellor has announced this afternoon an expansion to the Job Support Scheme which was unveiled a fortnight ago.

Under the expansion to the scheme, if a business is forced to close due to local or national restrictions, the Government will pay two thirds of employees’ wages, up to a cap of £2,100 per month. Employers will not be obliged to contribute to wages, but larger businesses will be required to pay NICs and pension contributions.

The scheme will only apply to businesses forced to close by law, rather than those who choose to close (or are not financially viable) because of the impact of coronavirus restrictions. The scheme is clearly intended to benefit the hospitality sector, which is likely to be heavily impacted by further restrictions.

The scheme will begin with effect from 1 November 2020 and will run for six months with a review in January 2021. Employers will be required to claim the grants in arrears, in the same way as applies to the JSS announced a fortnight ago. This could well be problematic for many employers with cashflow concerns.

We await full details of the scheme and will provide further information as soon as it is available. However, at present, the scheme appears to be more generous than the terms of the CJRS which will come to a close on 31 October 2020.In anticipation of harsher restrictions, which could be in place as early as next week in parts of England, the Chancellor has announced this afternoon an expansion to the Job Support Scheme which was unveiled a fortnight ago.

Under the expansion to the scheme, if a business is forced to close due to local or national restrictions, the Government will pay two thirds of employees’ wages, up to a cap of £2,100 per month. Employers will not be obliged to contribute to wages, but larger businesses will be required to pay NICs and pension contributions.

The scheme will only apply to businesses forced to close by law, rather than those who choose to close (or are not financially viable) because of the impact of coronavirus restrictions. The scheme is clearly intended to benefit the hospitality sector, which is likely to be heavily impacted by further restrictions.

The scheme will begin with effect from 1 November 2020 and will run for six months with a review in January 2021. Employers will be required to claim the grants in arrears, in the same way as applies to the JSS announced a fortnight ago. This could well be problematic for many employers with cashflow concerns.

We await full details of the scheme and will provide further information as soon as it is available. However, at present, the scheme appears to be more generous than the terms of the CJRS which will come to a close on 31 October 2020.

 


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Author: Lucy Gordon

Senior Solicitor, ESP Law Ltd

Lucy is an employment solicitor who brings to ESP over a decade’s experience at DLA Piper, one of the world’s most prestigious law firms. At DLA Piper, Lucy was involved in a number of global projects for major international customers and handled a varied case-load of employment matters for a range of UK customers, including complex Employment Tribunal cases involving whistleblowing and TUPE.

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