VIDEO EXPLAINER: Alternatives to redundancy – how to flex your workforce after furlough
This free Getting back to business webinar was held on Wednesday 6th May. On this video, employment partner Paul Scope and associate Flora Mewies looked at your options if you need to flex your employee resource or reduce cost without reducing headcount. This may apply across the business or to particular functions. They discussed a range of options when the furlough scheme comes to an end, including: lay off, short time working, reduced hours, reduced pay and other ways to be flexible.
They also discussed the pros and cons of each option, and cover what you will need to undertake with each of these routes.
Related FAQs
According to the guidelines laid down by the Treasury, many Start-up businesses will not be considered “viable” as they are at an early stage in the investment cycle (i.e. delivering negative returns but with strong growth prospects). This means they are unlikely to qualify for CBILS although for primarily UK based Start-ups it is still worth making enquiries as policies are rapidly evolving.
For early-stage businesses in their first two years of trading, the British Business Bank’s Start-Up Loans programme (loans £500 to £25,000 at 6% p.a. interest) may be more suitable. Visit www.startuploans.co.uk for more information.
For start-up businesses that are unable to access CBILS, the Government launched The Future Fund in May 2020 via the British Business Bank, which provides convertible loans to UK-based innovative companies ranging from £125,000 to £5 million, subject to at least equal match funding from private investors. This scheme is available until 30 September 2020 initially.
Your business is eligible if:
- it is UK-incorporated – if your business is part of a corporate group, only the parent company is eligible
- it has raised at least £250,000 in equity investment from third-party investors in the last five years
- none of its shares are traded on a regulated market, multilateral trading facility or other listing venue
- it was incorporated on or before 31 December 2019, and
- at least one of the following is true: (i) half or more employees are UK-based; and/or (ii) half or more revenues are from UK sales.
Further information is available on the Government website, www.gov.uk/guidance/future-fund
The Government is also offering additional support for small and medium size firms that are primarily focused on research and development. This targeted support is available through a continuity grant and loan scheme. The grant scheme is only available until 29 May 2020 while the loan scheme is open for applications until all the money is allocated or 31 December 2020 (whichever is earlier). This scheme is administered by Innovate UK, the national innovation agency, and this support will mostly only be available to existing Innovate UK customers.
Further information is available on the on the Government website, www.gov.uk/government/publications/access-coronovirus-business-innovation-support-package
It really depends on what your measure of success is! We would suggest regular wellbeing surveys – if the results of wellbeing surveys suggest that the culture is becoming more open, more psychologically safe, if people are asking for help or referring colleagues to MHFAs as a safe and effective pair of hands – these would be strong indicators of success.
Yes, but your claim will be limited to any enhanced contractual payments you make to employees who qualify for the relevant family related pay.
All maternity and parental rights remain in force for anyone in this category who is furloughed. However you may need to calculate average weekly pay differently if the employee was furloughed and then started family related leave on or after 25 April 2020.
Furlough pay cannot be claimed for the period that an employee is receiving Maternity Allowance. An employee can agree to accept furlough pay but they must contact Jobcentre Plus to stop their Maternity Allowance payments for this period.
Government’s Covid-19 landing page
https://www.gov.uk/coronavirus
Covid-19 recovery strategy
Working safely during Covid-19
https://www.gov.uk/guidance/working-safely-during-coronavirus-covid-19
Working safely during Covid-19: construction and other outdoor work
Working safely during Covid-19: factories, plants and warehouses
Working safely during Covid-19: labs and research facilities
https://www.gov.uk/guidance/working-safely-during-coronavirus-covid-19/labs-and-research-facilities
Working safely during Covid-19: offices and contact centres
https://www.gov.uk/guidance/working-safely-during-coronavirus-covid-19/offices-and-contact-centres
Working safely during Covid-19: other people’s homes
https://www.gov.uk/guidance/working-safely-during-coronavirus-covid-19/homes
Working safely during Covid-19: restaurants offering takeaway or delivery
Working safely during Covid-19: shops and branches
https://www.gov.uk/guidance/working-safely-during-coronavirus-covid-19/shops-and-branches
Working safely during Covid-19: vehicles
https://www.gov.uk/guidance/working-safely-during-coronavirus-covid-19/vehicles
Business support: loans, tax relief and grants for businesses, employees and self-employed people
https://www.gov.uk/coronavirus/business-support
Education and childcare
https://www.gov.uk/coronavirus/education-and-childcare
Housing and accommodation: renting: guidance for landlords, tenants and local authorities
Housing and accommodation: moving home
Housing and accommodation: planning inspections
https://www.gov.uk/guidance/coronavirus-covid-19-planning-inspectorate-guidance
Healthcare workers, carers and care settings: NHS guidance for people working in healthcare
https://www.england.nhs.uk/coronavirus/
Healthcare workers, carers and care settings: PPE hub
https://www.gov.uk/government/collections/coronavirus-covid-19-personal-protective-equipment-ppe
Healthcare workers, carers and care settings: adult social care guidance
https://www.gov.uk/government/collections/coronavirus-covid-19-social-care-guidance
Healthcare workers, carers and care settings: shielding and protecting people who are clinically extremely vulnerable
Healthcare workers, carers and care settings: adult social care guidance
Healthcare workers, carers and care settings: health, care and volunteer workers parking pass and concessions
International travel and immigration: travel advice for British citizens travelling abroad
https://www.gov.uk/guidance/travel-advice-novel-coronavirus
International travel and immigration: foreign travel advice for each country
https://www.gov.uk/foreign-travel-advice
International travel and immigration: waiting to return to the UK
International travel and immigration: essential international travel guidance
https://www.gov.uk/guidance/coronavirus-covid-19-essential-international-travel-guidance
International travel and immigration: advice for UK visa applicants and temporary UK residents
Government’s financial support for businesses
This page help businesses find out how to access the support that has been made available, who is eligible, when the schemes open and how to apply.
https://www.businesssupport.gov.uk/coronavirus-business-support/
Rishi Sunak
The Twitter feed of the Chancellor of the Exchequer, where he has published various responses to some FAQs from the public.
https://twitter.com/RishiSunak
Similar to the position for claims between 1 August 2020 and 31 October 2020, for claims between 1 July 2021 and 30 September 2021 there will be a cost to businesses of furloughing staff, which will gradually increase until the scheme closes at the end of September as follows.
- From 1 July 2021 employers will be required to contribute 10% of wages, with the Government contributing 70%.
- From 1 August 2021, the employer contribution increases to 20% and the Government will contribute 60%.
- 30 September 2021: scheme closes.
Employees will continue to receive 80% of their current wages, up to £2,500 a month.