The Government’s Coronavirus Job Retention Scheme was introduced to try and mitigate some of the financial impact of social distancing and lockdown measures on the British economy. The scheme offers to cover 80% of the wages of so called ‘furloughed’ workers to a maximum of £2,500 per month per employee. Initially introduced for a period of three months, it was recently (17 April) extended until the end of June and then further extended (12 May) until October, with some revisions in terms of employers’ contributions coming into play from August.
Since its introduction, there have been many calls for the scheme to be further extended, in particular to offer more flexibility for employers. One of these has come from Head of the Chartered Institute of Personnel and Development (CIPD), Peter Cheese.
The ‘all or nothing’ approach to furloughing staff was particularly criticised by Cheese. He argued that this gives staff no opportunity to undertake any work at all for their employer. The effect of this is that those staff who have not been furloughed may be under greater pressure either from increased workloads or through having to work in unfamiliar areas. Meanwhile, those who have been furloughed may feel trapped at home with nothing to do, wasting potential and leading to feelings of uselessness and (potentially) poor mental health.
As lock down measures are phased out over time and the economy slowly recovers, Cheese argued that increased flexibility could enable employers to phase their workers gradually back into work, hence helping to ease the burden on the public purse.
The good news is that in his address on 12 May, the Chancellor indicated that more flexible options would be introduced to the furloughing scheme after July, including the possibility of bringing staff back to work part-time.
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