Furlough ends in 98 days – is your business Non-Furlough ready?
Even though the June 21st easing of lockdown has been delayed in England and there currently being no date in Wales, there has been no further extension of Furlough, at present, it will end on 30th September of this year 2021 – which is only 98 days from today.
The winding down of the scheme begins on the 1st July when government contributions will reduce to 70% of staff wages. That means businesses will have to make up 10%.
1st August, government contributions will reduce again, this time to 60%. That means businesses will have to make up 20%.
There are no further changes until 30th September 2021, when the scheme is scheduled to end and support will be withdrawn.
Businesses may be faced with some tough decisions in preparation for the scheme withdrawal which for many, has been literally business saving. Now is the time to start preparing so we have put our heads together and created 10 steps to help you prepare.
1. Carefully plan when you need staff to return.As furlough becomes a less viable option and businesses re-open, returning people to work is likely your best alternative. 2. Who do you need back, and when?
There may be some roles that need to be filled more than others. When making decisions, focus purely on the role, not the person, to avoid discrimination. 3. How much work will staff do when they return?
Consider using flexible furlough, where staff remain on furlough on a part-time basis, this is an option until September 2021-use it. 4. Give staff as much notice as possible of their return.
If you specified how much notice you would provide them in the original furlough agreement, stick to this timeframe. 5. Stay on top of changes to the furlough scheme
You need to contribute 10% to the furlough grant from July, and 20% from August. This may prove costly if some staff are to remain on furlough. 6. Plan for pay
Staff back from furlough, whether flexibly or completely, will need to be paid in full for the time that they work. It is essential that you make sure their pay packets are correct. 7. Consider ways to keep costs down
Keep costs down by freezing recruitment/training or hold off on pay rises for staff. If training or pay rises are contractual, get the employee’s agreement before making the change. 8. It’s good to talk – encourage staff communication
Make sure staff feel comfortable in coming forward with any concerns they may have. Do they feel they need further support from management? 9. Consider redundancies if necessary
If you aren’t able to bring staff back off furlough and are unlikely to do so after September, redundancies can be considered. You need to be aware of consultation timings and always ensure that you follow a fair procedure. 10. Re-furlough staff if necessary
Employees taken off furlough can be re-furloughed up until 30 September 2021. As long as the scheme is running, it is a viable alternative to redundancy.
With only 98 days to go until the support of furlough ends the time to act is now in order to avoid issues further on down the line. Don’t delay and wait for September to act. Unsure of what to do?
