Announced by Chancellor Rishi Sunak on 24 September, the Job Support Scheme will run for six months from 1 November and will top up salaries in firms which can’t afford to pay employees their normal full-time hours.
To be eligible, employees must work for at least one-third of their normal hours.
For the hours not worked, the government and employer will each pay one-third of the remaining wages.
This means the employee would get at least 77% of their pay.
For example:
- Donald works 40 hours a week
- His employer needs to reduce his hours to 1/3 of this, so to just 13.3 hours – and will pay him for this
- Of the remaining 26.7 hours
- His employer pays him a further 1/3 = 8.9 hours
- The Government pays 1/3 = 8.9 hours
- And he goes unpaid for the remaining 1/3 = 8.9 hours
So overall:
- Donald works for a reduced 13.3 hours = 33% of his normal working week
- But gets paid for 31.1 of his normal 40 hour week = just over 77%
- He goes unpaid for 8.9 = 22%
- And the Government contributes 8.9 hours = roughly 22%, but capped at £697.92 per month
It means the government will pay a maximum of circa 22% of someone’s wages, down from 80% at the start of the furlough policy.
All small and medium sized businesses will be eligible for the scheme and it will be open to employers across the UK even if they have not previously used the furlough scheme (which comes to an end) and the scheme will run for six months starting in November 2020.
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