• Eamonn Watson

STAFF WAGES IN SHUTDOWN

Updated: Oct 16

With businesses already closed by law, or under threat of closure soon, staff are still waiting for the full guidance on wage support and the Job Support Scheme Extension.



Under the expansion, firms whose premises are legally required to shut for some period over winter, as part of local or national restrictions, will receive grants to pay the wages of staff who cannot work - protecting jobs and enabling businesses to reopen quickly once restrictions are lifted.


Meanwhile the Job Support scheme which begins on November 1st, caters for those businesses still allowed to continue trading.


WHAT WE KNOW AS WE AWAIT THE FULL GUIDANCE


EMPLOYERS


Neither the employer nor the employee needs to have previously used the Coronavirus Job Retention Scheme


If your businesses is forced to close by law, your P.A.Y.E staff will be paid a 67% furlough to a maximum of £2,100 a month


All employers forced to close, with a UK bank account and a UK PAYE scheme registered on or before 23 September 2020 can claim the scheme. This means a Real Time Information (RTI) submission notifying payment to that employee to HMRC must have been made on or before this date.


The Job Support Extension scheme will begin on November 1st 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.


This includes premises restricted to delivery or collection only services from their premises.


Under the scheme, employers will not be required to contribute towards wages and only 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.


Venues which are already legally closed, such as nightclubs, will also be eligible.


Employees of firms that have been legally closed in the period before November 1st are eligible for the CJRS.


The scheme is UK wide and the UK Government will work with the devolved administrations to ensure the scheme operates effectively across all four nations.


Businesses required to close as a result of specific workplace outbreaks by local public health authorities are not eligible for this scheme


EMPLOYEES


Similar to the Job Support Scheme, where employees receive two-thirds of their wages for time not worked, the grant per eligible employee available from the UK Government is two-thirds of their normal pay up to a limit of £2100 per month. Further detail on how normal pay is calculated will be set out in guidance


Your employer can claim under the rules announced October 9th if their premises are closed.


When premises re-open, employers can claim under the JSS for firms facing reduced demand under the criteria set out on 24 September


In line with the announced JSS, employers will be able to claim the Job Retention Bonus for employees provided they are eligible and previously part of the CJRS.


JSS grants can be used by employers to pay an employee's wages and help meet the JRB Minimum Income Threshold.


Employees cannot be made redundant or put on notice of redundancy during the period within which their employer is claiming the grant for that employee.


WHAT DOES THE GRANT COVER?


The employer must use the scheme to cover their employees’ wages and pay relevant payroll taxes. The whole of the grant must be used to meet employee costs.


The grant will not cover Class 1 employer NICs or pension contributions, although these contributions will remain payable by the employer.


Payments will be made in arrears, reimbursing the employer for the Government’s contribution.


HOW CAN I CLAIM?


Employers will be able to make a claim on a monthly basis online through gov.uk from December 2020 and this will be reviewed in January 2020


HMRC CHECKS


HMRC will check claims. Payments may be withheld or need to be paid back if a claim is found to be fraudulent or based on incorrect information.


Grants can only be used as reimbursement for wage costs actually incurred.


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.


HMRC intend to publish the name of employers who have used the scheme, and employees will be able to find out if their employer has claimed for them under the scheme.


HMRC will continue to operate a hotline for individuals to make reports of any fraudulent claims they may be aware of.


Read the JSS Extension factsheet

We're here to help you through this together, so the T+G support blog is updated every day.

For any advice you need, just call 01995 600 600, or

email our dedicated, support team at covid19@tagac.co.uk


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