What happens after the furlough scheme ends?

From 1 August 2021 until the scheme ends, the Government’s grant reduced a final time to 60% of furloughed employees’ wages for their unworked hours at a cap of £1,875.  Employers need to contribute 20% to staff wages up to £625 and this will remain the same until the end of the scheme on 30 September 2021.

Business owners need to consider how they can protect their interests. This could take the form of bringing staff back into work or allow them to work from home if possible and if work is available.

Businesses will also need to consider the following points:

• Reducing staff hours – making structural changes to their workforce if possible, such as reducing the number of hours that their employees work, bringing them back on a part-time basis. This will not only help to support employees who may otherwise be made redundant, it will allow employers to retain existing talent. Again, employees need to agree to this change as it will impact on the terms and conditions of their current contracts. Most importantly, employees cannot be forced to reduce their hours
• Lay-offs and short-time work – otherwise known as ‘LOST’, these are usually considered as an alternative to compulsory redundancies, especially when there is a downturn in workload or the finance necessary to fund full-time employment. Employees may be placed on unpaid LOST where there is a contractual term entitling employers to do so. In the absence of such as contractual clause, employers will need to agree this with staff otherwise it will breach employees’ contracts of employment.
• Redeployment – if one area of a business no longer requires either all, some, or most staff, then employers can redeploy them elsewhere, either temporarily or permanently.
• Redundancy – employers should consider if there are alternative measures that could be utilised to reduce the need for redundancies as this should be a last resort option.

It is important to note, as mental health awareness carries on making headlines, that employees may be struggling during this period. It is advisable to offer support in the form of an employee assistance programme (EAP) or equivalent where possible.

If you would like to discuss this further please contact us.