Advice on the Job Support Scheme

Vanessa Sanders

Stanbridge Associates’ specialist medical accountant Vanessa Sanders outlines next month’s Job Support Scheme.

Starting on 1 November, the Job Support Scheme (JSS) will run for six months until 30 April 2021. 

It is offering support to businesses facing reduced demand throughout the winter months. The employer must continue to pay workers for the actual hours worked, but the new scheme will provide a grant to cover some of the cost of hours not worked.

  • The Government will make a grant to the employer equal to one third of hours not worked up to a cap of £697.92 per month.
  • The employer will bear the cost of a further one-third of hours not worked plus the actual hours worked in the business.

It appears that the employee must also bear some of the cost by suffering an agreed reduction to their salary for the hours not worked in order to keep their job. But looking at the way the scheme works, it may not make sense to retain employees on a part-time basis, but to consider redundancies and bring back in some employees on full time.

Neither the employer nor the employee needs to have previously used the Coronavirus Job Retention Scheme (CJRS), although much of the practical detail is similar to the CJRS.

Read HM Revenue and Customs’s (HMRC’s) guidance on on the scheme by clicking here.

An example

Joanne works five days a week and earns £1,000. Following discussion, she agrees to accept short-time working of two days per week (40%) and her employment contract is revised to reflect this. The minimum percentage of time she must work is 33%.

She is paid £800 comprising:

Cost borne by employer for time worked: 40% x £1,000 = £400

Cost borne by employer: 1/3 of the normal wages for time not worked: 1/3 x 60% x £1,000= £200

Government grant: 1/3 of the normal wages for time not worked: 1/3 x 60% x £1,000= £200

Total pay to Sue = £800

National Insurance Contributions (NICs) and pension will be calculated by reference to this figure.

In this illustration, Joanne earns 80% of her normal wage. The 1/3 contribution rule ensures that employees on this scheme continue to earn a minimum of just over 77% of their normal wages (unless the Government contribution has been capped at the maximum). 

Her employment contract will need to be revised and the earnings reported through the payroll and real-time information (RTI) in the usual way. However, JSS grants do not cover employers’ NICs or pension contributions. 

Employers must pay these costs as usual, although we do not know yet on what the NICs will be calculated, but presume it will be the amount reported through the payroll.

Inherently discriminatory 

Thus, depending on the levels of earnings, it may be less expensive to retain one member of staff on normal hours and let part-timers go. This will be doubly difficult for employers, as this will be inherently discriminatory, as more women than men work on reduced hours.

The claims portal on will open in December 2020, but how November will be funded in cash flow terms remains unclear. Each claim will be submitted for a given pay period and must be after the employee has been paid and that payment has been reported to HMRC through RTI.

Grants re-imbursing employers for the Government’s contribution will be paid in arrears, on a monthly basis. Employers using the JSS will also be able to claim the Job Retention Bonus of £1,000 per employee, if they meet the eligibility criteria.

Any employer with a UK bank account and UK PAYE scheme can claim the grant. Thankfully, there will be no financial assistance test for small and medium-sized enterprises. 

It is not clear, however, if there will be any rules about dividend payments being allowed, so directors on smaller salaries may again be hit by restrictions.

Qualification criteria

To qualify, employees must have been included on the payroll in a full payment submission made on or before 23 September 2020. This means that some newer employees who were not previously eligible for the furlough scheme can be entered into the JSS. 

This is to make up for the fact some businesses may have re-employed staff because of the lifting of restrictions which are now hitting them again.

During the first three months of the scheme – 1 November 2020 to 31 January 2021 – employees must work at least 33% of their usual hours. 

The Government will consider increasing this minimum threshold for the following period. For time not worked, employees will be paid up to two-thirds of their usual wage.

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.

The Government grant is based on 1/3 of the hours not worked and usual wages, which are those prior to the furlough leave being implemented. Thus the ‘usual wages’ calculation is going to be as complicated as under the CJRS, but we anticipate even more guidance on this.


HMRC has produced a factsheet containing a separate section on compliance, with some of the rules making it clear that the Government has designed this new support in order to back viable jobs in businesses that are suffering now but which anticipate a recovery post-Covid, and not merely to keep people in work and businesses afloat who cannot survive.