The key points to note on the Job Retention Bonus are as follows:
The bonus - The bonus is a £1,000 one-off taxable payment to the employer, for each eligible employee who was furloughed and kept continuously employed until 31 January 2021. The payment does not have to be passed on to the employee.
When to claim - Employers can claim for the Job Retention Bonus in a six week window between 15 February 2021 and 31 March 2021. No further claims will be accepted after this date. The guidance will be updated at the end of January providing details on how to access the online claim service.
Interaction with Job Support Scheme - The employer can still claim the bonus even if they make a claim for that employee through the Job Support Scheme. Please see our Legal Update for further information on the JSS.
Eligible employees - The key criteria includes:
- The employer must have made a claim for the employee under the Coronavirus Job Retention Scheme (CJRS).
- The employee must have been continuously employed from the end of the claim period of the last CJRS claim until 31 January 2021.
- The employee must not be serving a contractual or statutory notice period on 31 January 2021 (this includes people serving notice of retirement).
- The employee must be paid sufficiently each relevant tax month and enough to meet the Job Retention Bonus minimum income threshold.
Minimum income threshold - To meet the minimum income threshold the employer must have paid the employee a total of at least £1,560 (gross) between 6 November 2020 and 5 February 2021. The employer must pay the employee at least one payment of taxable earnings (of any amount) in each of the relevant tax months.
TUPE - Employers may be able to claim for employees who have transferred to them under TUPE or due to a change of ownership. To claim the bonus for these employees the employer must have furloughed and successfully claimed for them under the CJRS. Employers will not be able to claim for employees who transferred after the CJRS closes on 31 October 2020.
Before claiming - Before a claim can be made the employer will need to have reported all payments made to the employee between 6 November 2020 and 5 February 2021 to HMRC through Full Payment Submissions via Real Time Information (RTI).
As the impact of the pandemic continues to be felt, employers are prioritising contingency planning. The detail of the Job retention Bonus is crucial and in particular, how it interrelates with other government schemes on offer enabling employers to make fully informed decisions concerning their own budgeting and business planning. With a clear focus on bringing people back into the workplace and protecting viable jobs, the government's hope will be that the assistance available is enough to at least mitigate the number of job losses. Although the Job Retention Bonus is perhaps not enough on its own to prevent wide scale redundancies, when combined with the Job Support Scheme it is hoped that numerous jobs can be saved.
It is key for employers who are considering making redundancies to consider the government support available. With the Job Support Scheme requiring larger employer contributions than previous support available, it is important for employers to carry out a detailed audit of which jobs can be protected. Trade unions and employees alike will be looking for employers to utilise these schemes and avoid cuts where possible.
If you require any assistance please do not hesitate to contact our UK based employment experts.