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April 14, 2021

Extension to Job Support Scheme – Key Points

The Job Support Scheme (replacing the existing furlough scheme) takes effect from 1 November, for a period of 6 months.

The Extension (announced last week) applies to businesses required (by law) to close due to local or national restrictions.

Government will pay 67% of employees’ wages under the Extension, subject to a cap of

£2,100 a month. Employers can choose to top up pay.

This is higher than payments under the basic Job Support Scheme, which applies to employees working at least 33% of their usual hours.

The Extension only applies to businesses which are required to close, and will not apply to businesses which are able to stay open but whose trade is badly affected, or to businesses who choose to close (but are not required to do so).

Employers can claim under the Extension in respect of employees who have been told not to work because of the closure of the business.

There is no requirement for employees to have been furloughed as a condition of eligibility.

To be eligible, employees must have been told to cease work and must actually cease work for a period of at least 7 consecutive days.

The Extension will run in parallel with the basic Job Support Scheme and Job Retention Bonus.

Payments will be taxable. Employers must pay employer NICs and auto enrolment pension contributions.

Employers will need to agree the changes to their employees’ terms and conditions. This should be confirmed in writing.

When a business reopens, SMEs will be able to claim under the basic Job Support Scheme.

Employers cannot give notice of redundancy or terminate an employee’s employment by reason of redundancy, during any period for which they are claiming under the Extension or basic Job Support Scheme for that employee.

It isn’t clear how businesses will be treated if they have already started redundancy consultations or given notice of termination. If notice hasn’t yet been given, employers might want to put consultations on hold and instead claim under the Extension or basic Job Support Scheme.

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