As announced by the Chancellor in his Plan for Jobs on 8 July 2020, the £2bn Kickstart Scheme aims to create hundred of thousands of jobs for young people across the UK.
Under the Scheme, employers will be able to offer 6-months placements to those aged 16-24 who are claiming Universal Credit and find themselves at risk of long-term unemployment.
The Government will provide participating employers with a grant covering 100% of the relevant National Minimum Wage for a 25-hours work week, plus NICs and the minimum employer auto-enrolment pension contributions.
According to the official announcement, the Government will also provide additional funding to support young people as they move into sustained employment after they have completed their Kickstart placement.
How It Works
Applications for the Scheme are open from 2 September 2020.
The Scheme is open to all organisations in England, Scotland and Wales, as long as they are looking to create at least 30 new 6-month job placements for young people.
Such placements should support employees to develop the skills and experience they need to find work after completing the scheme.
If their application is successful, the Government will cover the full cost of the relevant National Minimum Wage for 25 hour per week for the whole placement, plus NICs, pension contributions and an additional £1,500 per job placement to cover setup costs, support and training.
Companies who are unable to offer at least 30 placements can partner with other organisations to reach the minimum number.
There has been some criticism on the Scheme from small businesses who feel like the 30 job placements requirement makes the Scheme accessible only to larger companies, and some have called for an amendment to the rule.
There is information on HMRC’s website on how to partner with other organisations to reach the minimum job placement number.
Who Is Eligible
The main requirement of the Scheme is that the 30 job placements constitute new jobs, and as such they must not:
- replace existing or planned vacancies;
- cause existing employees or contractors to lose or reduce their employment.
Additionally, the roles that employers can apply for must be:
- a minimum of 25 hours per week, for 6 months;
- paid at least the National Minimum Wage for their age group;
- should not require people to undertake extensive training before they begin the job placement.
In the applications, employers should include details on how they plan to:
- support to look for long-term work, including career advice and setting goals;
- support with CV and interview preparations;
- supporting the participant with basic skills, such as attendance, timekeeping and teamwork.
Once a job placement is created, it can be taken up by a second person once the first successful applicant has completed their 6-month term.
How to apply
Organisations that are creating more than 30 job placements as part of the Kickstart Scheme, can submit their application directly to HMRC.
During the application process, employers will need to provide:
- their Companies House reference number or Charity Commission number;
- their address and contact details;
- details of the job placements and their location;
- supporting information to show that the job placements are new jobs and meet the Scheme’s criteria;
- information about the support the organisation can give to develop employability skills of young people.
Once HMRC has verified that the application meets the requirements, each application will be reviewed by a panel to ensure that it complies with the Scheme’s criteria.
HMRC aims to respond to applications within 1 month, although they might ask for further information during the review process.
Successful applicants will receive a letter with a grant agreement, including what your company has agreed to provide and the relative funding allocated under the Kickstart Scheme.
Before placements begin, the agreement must be signed and returned. Employers must also provide job descriptions for each placement, including details of the application process.
After this, candidates who have been matched with each placement will contact the relevant employer. Employers will then be able to choose who to employ among those who apply.
If an application does not meet the requirements of the scheme, HMRC will explain why and give feedback.
There is no limit to the number of times employers can apply for funding, however there is no legal right of appeal.
How funding is paid
A grant covering initial setup costs will be provided once the employer confirms that the candidate has started work and is enrolled on payroll.
The Department for Work and Pensions will us HMRC information to verify that the young person is still employed and will provide the rest of the grant in arrears.
Companies Creating Fewer Than 30 Jobs
Smaller organisation that are creating fewer than 30 job placements cannot apply directly.
The only way for them to apply is as part of a group of organisations in order to reach the minimum requirement of 30 placements.
Other organisations could include:
- similar employers;
- local authorities;
- trade bodies;
- registered charities.