Updated for 22/10/2020 - Article and calculator updated for the announcement made to increase support levels from government.
From November 1st 2020 to April 30th 2021 the Job Support Scheme will allow employers to cut employee hours to a fifth of regular contracted hours, but allow employees to still receive a minimum of 73 percent of their normal pay (where caps haven't been hit).
Here is a quick calculator for employees to estimate how much pay they would receive:
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The employer pays for any hours the employee actually works, of the shortfall in wages, 61.67% is paid by the government and 5% is paid by the employer. This allows the employer to keep the employee on payroll, and still be eligble for the job retention bonus.
However, the calculation can be a little confusing as the government contribution is capped to a maximum of £1,541.75 a month. It also does not cover employer obligations on the pay the employee receives - so employer NICs and auto-enrolled pension still needs to be paid by the employer. The employer's 5% contribution is also capped to £125 a month.
Another note is that for the first three months, the employee must work a minimum of a 20% normal hours but after three months this threshold may increase.
Small and medium companies (SMES) are not means tested for eligibility, but large companies will have to be experiencing difficulties to join the scheme. Employees will also have to be on payroll before 23/09/2020.