The Chancellor Mr Rishi Sunak has announced an extension to the current job support scheme, which will see government pay the employee two thirds of their usual wage should they face local lockdown restrictions.
This comes after the announcement of the JSS (Job Support Scheme) which we spoke about previously.
Announced on Friday 9th October 2020, dubbed Restricted Furlough 3.0, the announcement was made in light of the increasing numbers of Covid-19 infections.
Mr Rishi Sunak said, that in order to protect jobs, we must "evolve as the crisis and our health response evolves".
To be eligible, an employee must be furloughed for a minimum of at least 7 days at a time, they will then receive 66% of their wages.
They must also have been on an RTI submission before 23rd September 2020.
The employer will be required to make a payment to the employee up front, and cover the cost of National Insurance and Pension contributions, before they are able to claim back the money from the government.
The employer can then claim back the cost of those wages, however they will not be able to claim back the National Insurance or Pension Contributions.
In other words, an RTI submission and a payment to the employer must be made, before any claim can be done.
How is the employee affected
Under the new restricted furlough, the employee must lose around a third of their usual wages, and in most cases their employment contract will need to be amended to allow for these changes.
Employers will not be able to make up the third of wages lost due to being on the restricted furlough.
When can the employer claim
The new portal to make the restricted furlough claim will not open until 1st December 2020, and so employers will need to ensure they have already paid their employees, whether that be by using any cash reserves or applying for a loan to cover the cost.
How long will this scheme last
The scheme will last for six months, running until 31st March, however the scheme will be reviewed by government in January 2021.
Further help for business
Local lockdown grants were announced in September, whereby a business can claim up to £1,500 every three weeks, if they find their business has been affected by local lockdown measures.
However, this has now been revised to include grants of up to £3,000 per month, payable every two weeks.
The amount of grant available will depend on the size of the business, and will be calculated based on the businesses rateable value.
For small businesses with a rateable value below £15,000, up to £1,500 per month will be available to claim.
For those with a rateable value between £15,000 and £51,000 will be able to claim £2,000 per month.
Its important to note that these government grants will only be available to those in England.
Scotland, Wales and N. Ireland will set out their own response to local lockdown measures by using the £12.7 Billion set aside for them from the UK Government.
Courtier and Courtier understand that the new Job Support scheme can be very tricky to get right, and so if you require any help in making sure you claim the correct amount of furlough, contact us today.