Furlough to be replaced with new ‘Jobs Support Scheme’

The furlough scheme is due to end on 31 October 2020, with employers claiming nearly £40bn for 9.6 million workers since the scheme opened. Now, as the economic impact of the coronavirus pandemic continues to reverberate and with winter fast approaching, the Chancellor has been facing increasingly strident calls to continue supporting workers financially in the runup to Christmas. The new Jobs Support Scheme, which will begin on 1 November and run for six months, is designed to top up the salaries of employees whose firms cannot afford to take them back full time.

What are the rules?

With different eligibility requirements than the original Coronavirus Job Retention Scheme, employees must work for at least a third of their normal hours to qualify for the new Job Support Scheme (instead of no hours at all), and have been on the company’s payroll since 23 September at the latest. For the hours not worked, their employer and the government will pay one-third each of their remaining wages – meaning that the employee will receive at least 77% of their normal salary – almost the same amount as they would have received under the furlough scheme. Government contributions are capped at £697.92 per month and the new rules mean it will pay a maximum of 22% of workers’ wages from November onwards.

The scheme will only be open to small and medium-sized businesses (SMEs), as opposed to all businesses as with the furlough scheme, although larger firms may be eligible if they can prove their income has been impacted by COVID-19. Furthermore, employees must be in so-called “viable” jobs to be eligible. In other words, those working in industries that are still closed – such as nightclubs or dancing venues – will miss out.

What other support is still available?

In its bid to save as many jobs as possible, the government is also providing firms with a range of bonuses for taking on employees or trainees:

• £1,000 for every furloughed employee retained until at least 31 January
• £1,500 for every unemployed young adult (aged between 16 and 24) offered a “high-quality”six-month work placement
• £2,000 for every apprentice taken on under the age of 25 and £1,500 for those aged over 25.

Can I be made redundant while on a support scheme?

On the furlough scheme, you can be made redundant at any point. If you are entitled to redundancy pay, it will be based on your full salary. However, you cannot be made redundant or given notice if your employer is claiming for your salary on the Jobs Support Scheme.

Employment lawyers, here for you

If you are an employer with workers on furlough leave, or you’re thinking of claiming on the Jobs Support Scheme, it’s important to seek professional legal advice if you are at all unsure of the rules. You’ll still need to follow all the normal procedures when making furloughed employees redundant, for example – otherwise you could leave yourself open to claims for unfair dismissal or discrimination.

If you are unsure of your rights and responsibilities as an employer, or wish to discuss either the furlough scheme or the new Jobs Support Scheme with an Employment Law solicitor, please contact ahmet.ozcan@attwaters.co.uk or call 0203 871 9254.