HR · 12 June 2020

NEWS: Furlough deadline has passed: What options do employers have now?

staff-furlough

This week has been a milestone for UK employers during the coronavirus saga as the deadline has passed for them to put new staff on furlough.

Employers had up until June 10 to put any further employees on the Government scheme.

The deadline news is part of Chancellor Rishi Sunak’s overall plan to gradually reduce the furlough scheme, (also known as the Coronavirus Job Retention Scheme), over the coming months.

Currently, employees on furlough receive 80% of their salary up to £2,500 but are not allowed to undertake any work for their employer.

While furloughing was implemented to combat the economic effects of the coronavirus pandemic, it was intended to be a temporary measure. With over a quarter of the UK workforce, (nearly 9m people), on furlough and its related costs currently exceeding £19.6bn, it’s not surprising that the Government seek to gradually ease its financial burden.

While the Chancellor confirmed last month that the furlough scheme has been extended in its present form until August 2020, Sunak has revealed that employers will be paying towards a portion of their furloughed employees’ wages by October 2020 in a bid to get the economy going, and people back to work.

While the gradual winding up of the furlough scheme might unnerve some furloughed staff, in may stimulate a more lively recruitment sector, says Dean Sadler, CEO at recruitment software platform, Tribepad. He provides commentary on the  sector from the employee perspective and what he thinks will happen as lockdown laws ease;

As Rishi Sunak confirms the furlough scheme will be gradually withdrawn, and businesses will be meeting 20% of the wage bill by October, we will start to see a lot more movement in recruitment as we come out of lockdown – especially from those who have been furloughed.

“More than a quarter of the UK workforce is now being supported by the scheme; around 8.9 million people. This is a big number. Yet, those forced into this position may possibly be looking to leave their current employer, as they might have lost the attachment they once had with the company. Employers cannot ignore this fact. Even for those who have abided by the furlough rules, many will have used this time to reflect on their career choices and what they want from their work life.

“Lockdown is a great opportunity for people to job hunt, and if on furlough, they will have much more time on their hands to do so. Many will already be applying for new roles and will be the first to jump once life stabilises. So now is a crucial time for employers to knuckle down and check in on all employee’s state of mind, especially those on furlough.

“It’s a daunting time for some. Many are worrying about job security, and as the furlough scheme comes to an end, difficult redundancy decisions are going to have to be made. So, it’s employers’ responsibility to make sure they are doing all they can to provide their workforce with that extra support. If not, businesses may lose critical team players they may have wanted to keep. And, if companies are to come back from this, they need the right set of people around them to do so.”

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