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Government Job Support Scheme - Cobalt HR

October 13, 20200

What is it?

The Job Support Scheme is designed to protect viable jobs in businesses who are facing lower demand over the winter months due to Covid-19, to help keep their employees attached to the workforce. The company will continue to pay its employee for time worked, but the burden of hours not worked will be split between the employer and the Government (through wage support) and the employee (through a wage reduction), and the employee will keep their job.

The scheme will open on 1 November 2020 and run for 6 months, until April 2021. Further guidance will be published shortly. The Government will pay a third of hours not worked up to a cap, with the employer also contributing a third. This will ensure employees earn a minimum of 77% of their normal wages, where the Government contribution has not been capped. Employers using the Job Support Scheme will also be able to claim the Job Retention Bonus if they meet the eligibility criteria.

How does it work?

  • The Job Support Scheme starts on 1 November. It will run for six months – the Government hasn’t yet said when employers will have to apply to take part.
  • To qualify for the scheme, you must work at least a third of your normal hours. You’ll be paid as normal by your employer for that time.
  • For the hours employees can’t work, the cost is usually split THREE ways – the state pays a third, your employer pays a third and you lose a third. So an employee working 33% of their hours would earn at least 77% of their usual pay – 55% paid for by their employer, 22% by the Government.
  • However crucially the state contribution’s capped at just under £700/mth – so those earning more than around £38,000/yr will get less. The state won’t pay more than £697.92/mth, which means those who earn more than a certain amount – by our calculations, around £38,000/yr, though we’re checking – could get less than the 77%.

Who is eligible?

The scheme’s open to many – but not all employers can take part. It’s UK-wide – all small and medium-sized businesses are eligible, but larger businesses will be required to prove they’ve been adversely affected by coronavirus. Employers can take part regardless of whether they used the furlough scheme – those retaining furloughed staff on shorter hours can be part of the scheme and still get the job retention bonus announced earlier this summer. Employees cannot be on a redundancy notice while taking part.


  • All employers with a UK bank account and UK PAYE schemes can claim the grant. Neither the employer nor the employee needs to have previously used the Coronavirus Job Retention Scheme.
  • There will be no financial assessment test for small and medium enterprises (SMEs). Large businesses will have to meet a financial assessment test, so the scheme is only available to those whose turnover is lower now than before experiencing difficulties from Covid-19.
  • Our expectation is that large employers using the Job Support Scheme will not be making capital distributions, such as dividend payments or share buybacks, whilst accessing the grant. Further details will be set out in guidance.


  • Employees must be on an employer’s PAYE payroll on or before 23 September 2020. This means a Real Time Information (RTI) submission notifying payment to that employee to HMRC must have been made on or before 23 September 2020.
  • In order to support viable jobs, for the first three months of the scheme the employee must work at least 33% of their usual hours. After 3 months, the Government will consider whether to increase this minimum hours threshold.
  • Employees will be able to cycle on and off the scheme and do not have to be working the same pattern each month, but each short-time working arrangement must cover a minimum period of seven days.
  1. What does the grant cover?
  • For every hour not worked by the employee, both the Government and employer will pay a third each of the usual hourly wage for that employee. The Government contribution will be capped at £697.92 a month.
  • Grant payments will be made in arrears, reimbursing the employer for the Government’s contribution. The grant will not cover Class 1 employer NICs or pension contributions, although these contributions will remain payable by the employer.
  • “Usual wages” calculations will follow a similar methodology as for the Coronavirus Job Retention Scheme. Full details will be set out in guidance shortly. Employees who have previously been furloughed, will have their underlying usual pay and/or hours used to calculate usual wages, not the amount they were paid whilst on furlough.
  • Employers must pay employees their contracted wages for hours worked, and the Government and employer contributions for hours not worked. Our expectation is that employers cannot top up their employees’ wages above the two-thirds contribution to hours not worked at their own expense.

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