10 August 2020 | Reading Time: 2 minutes
What Happens When the Furlough Scheme Ends?
Almost 10 million workers who are unable to do their job because of the coronavirus outbreak have had their wages paid by the government.
The furlough scheme was designed to help people who couldn’t do their jobs because of the outbreak, and prevent mass redundancies. Some have criticised the decision to close the scheme in October, but it has been backed by the Bank of England which says workers should be helped to ”move forward” and not kept in unproductive jobs.
How is the furlough scheme changing?
Under the Coronavirus Job Retention Scheme, to give furlough its official title, workers placed on leave have been able to receive 80% of their pay, up to a maximum of £2,500 a month. Since July, these furloughed employees have been able to go back to work part-time. For example, an employer could pay someone to work two days a week, while the furlough scheme would cover the other three days not worked.
Since 1 August, employers have had to pay National Insurance and pension contributions for their staff. In September, employers will have to pay 10% of furloughed employees’ salaries – rising to 20% in October.
Can I be made redundant while on furlough?
Yes. Employees can be made redundant at any point during the scheme, and there are concerns there may be significant job losses when it ends. To encourage job retention, the government will pay businesses a £1,000 bonus for every furloughed employee they keep on until the end of January 2021. These workers must be paid an average of at least £520 a month between November and January. If a worker loses their job and is entitled to redundancy pay, this should be calculated based on their pre-furlough wages. New laws have been brought in to enforce this, after a ”minority” of firms were found to be calculating redundancy pay based on furlough.
Firms can’t use the money from furlough to subsidise redundancy packages. If you’re made redundant while on furlough because your firm has gone bust, you can apply to the Insolvency Service.
Can I work if I’ve been furloughed?
When the scheme began, furloughed staff weren’t able to do any work for their employer. However, they can now be brought back to work on a part-time basis. Those still on furlough can volunteer in the community or even for their company as long as they aren’t creating revenue or providing a service.
Furlough and Beyond
The Coronavirus Job Retention Scheme is due to come to an end on the 31st October. Where do business go from here? What can employees do who are affected and are at risk of redundancy? With that in mind Xpert Resourcing together with guest speak from Truth HR Solutions are running a 2 part morning workshop for both local SME’s and Employees currently on Furlough and/or are at risk of redundancy. Advice will be given on the legal implications of the scheme ending, redundancy, training schemes, funding and much more.
For your FREE ticket, please contact naomi.sherwood@xpertresourcing.co.uk
Tel: 01353 886252
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