Furlough & the Coronavirus Job Retention Scheme Ends
What Next ?
Leigh Gillatt • Recruitment Articles
FURLOUGH & THE CORONAVIRUS JOB RETENTION SCHEME ENDS
The Coronavirus Job Retention Scheme (CJRS) - as it was officially known, gave employers in the UK the option to claim the wages from the Government for any of their employees that they had to put on furlough or flexible furlough because of COVID-19. This was either due to, as a business, having generated reduced revenue during this period, or to help pay their workers for hours they were unable work due to restrictions etc.
As UK lockdown restrictions eased, the government slowly reduced the percentage of wages paid by the scheme from 80% to 60% and on the 30th September 2021 the furlough scheme ended completely.
This meant that as of the 1st October this year, all employers were responsible for paying wages for any hours not worked by their employees.
Some have predicted that overtime this may leave some businesses, that have still not seen their pre-covid revenue generation fully recover, unable to afford wages and being forced reduce contracted working hours or to make redundancies.
The coronavirus job retention scheme’s end also coincides with the government’s decision to remove the £20 per week temporary uplift in Universal Credit. It is estimated that over 2 million people will be affected by the two schemes ending, and at a time when household energy prices are soaring. Leaving many questioning will some families be having to make the difficult decision of whether to heat their homes or eat food this winter.
Figures from HMRC show:
- Since the start of the scheme a cumulative total of 11.6 million jobs have been supported by the CJRS at various times
- The number of furloughed employees reduced to 1.6m by July 2021 , down from 1.9 million in June.
- 5% of the UK workforce eligible for furlough were furloughed as of 31st July 2021.
- 51% of staff in passenger air transport and 46% of staff in travel agency and tour operators were still away from their jobs at the end of July.
The travel association ABTA has even warned that two thirds of employees within the industry may face being made redundant in the coming months due to what they described as “overly cautious” covid travel restrictions.
So What’s Being Done To Help?
The Chancellor, Rishi Sunak, has advised that the government is “doubling down” on plans to support job creation and training as businesses deal with the end of furlough scheme, recently announcing a £500m extension to his “plan for jobs”, alongside promising extra support in finding a job for the over-50s and workers coming off furlough.
Measures included in the new plan will include prioritising those coming off furlough for one-to-one support from jobcentres and extending until 31st January the £3,000 incentive for employers to take on apprentices.
Diverse Employment have been working closely with both employers and job seekers to support where we can during this transition period of getting back to work and removal of the CJRS.
For employers looking for assistance in filling any current vacancies they may have, feel free to reach out to our team.