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Staff to get up to £2,100/month if firms shut due to Covid-19 restrictions

Paloma Kubiak
Written By:
Paloma Kubiak
Posted:
Updated:
09/10/2020

Employees who work for businesses which are forced to closed due to local or national coronavirus restrictions may be eligible to receive two thirds of their salary, the chancellor has announced.

Thexpansion of the Job Support Scheme (JSS) will mean firms in areas legally required to shut in a bid to stop the spread of coronavirus, will receive grants to pay the wages of staff who can’t work.

A maximum of £2,100 a month (two thirds of their wages) can be paid to staff to protect jobs and enable businesses to re-open quickly once restrictions are lifted as part of the ‘localised furlough scheme’. Companies can top-up staff wages but they’re not required to.

Employers won’t be required to contribute towards employee wages and will only need to cover national insurance and pension contributions. 

Businesses will be eligible to claim while they are subject to restrictions and employees must be off work for at least seven consecutive days.

Businesses don’t need to have previously used the Coronavirus Job Retention Scheme to be eligible for the new support for employees.

The scheme will begin on 1 November and be available for six months, with a review of the scheme set to take place in January. It will apply across the UK and devolved authorities will handle the scheme across England, Northern Ireland, Scotland and Wales. 

Payments to businesses will be made in arrears through a HMRC claims service which will be available from December. 

The expansion of the scheme will sit alongside the existing JSS scheme, which changed at the beginning of the month and currently sees furloughed employees paid up to 60% of their wages.

The job retention scheme which pays employers £1,000 for every employee kept on until January is also still in place.  

Chancellor of the exchequer, Rishi Sunak, said: “Throughout the crisis the driving force of our economic policy has not changed. I have always said that we will do whatever is necessary to protect jobs and livelihoods as the situation evolves. 

“The expansion of the Job Support Scheme will provide a safety net for businesses across the UK who are required to temporarily close their doors, giving them the right support at the right time.” 

Cash grants for businesses

Additionally, the government is increasing cash grants to businesses in England which have been closed as part of local or national lockdowns.

The grants will support fixed business costs and be linked to rateable values, with up to £3,000 a month payable every two weeks, compared to the previous system of being paid up to £1,500 every three weeks.