Coronavirus News: Furlough Leave is extended to end of October
Today The Chancellor, Rishi Sunak, made an announcement extending the Government's Coronavirus Job Retention Scheme and Furlough Leave for another four months, until the end of October in a move that could see the Government's cost for operating the scheme rise to an estimated £100bn by the end of October.
This is a positive move that will take the pressure off employers who are facing an uncertain trading year.
In this move to provide further security to employers and employees, Furloughed workers will be able to take the benefit of the Furlough scheme up until the end of October 2020. Previously the scheme was available only until the end of June 2020.
Introduced earlier this year as one of the many measures to help the economy following the Covid-19 pandemic, the current Job Retention Scheme permits employers and workers to agree a period of Furlough leave rather than consider dismissal as a result of a downturn in revenue from the restrictions put in place by the Government. By taking-up Furlough, workers would instead accept 80% of their salary, up to a maximum of £2,500 per month.
- This extension to the scheme will look to bring people back in to work by allowing Furloughed workers to come back to work part-time.
- At present the rules require the worker not to carry out any work for the Employer whilst on Furlough leave.
There’s plenty of opinion and speculation on the impact of the Job Retention Furlough Scheme generally, but more so on the question of how it will be possible to bring workers back in to workplace in a phased and part-time way and remove the reliance on the Furlough Scheme.
Ashley Hunt, Director and experienced employment solicitor at Lawson-West provides his view on the announcement:
“This news is obviously reassuring, in the short term, to both employers and employees who are all trying to manage through this unprecedented time. Whilst there was speculation that the scheme might diminish significantly, the reality was that removing the scheme would simply have only delayed what we feared might happen at the end of March.
Clearly the Government is supporting the economy to give everyone the opportunity to come out of this in a semi-structural way and the ability to introduce workers on a part-time basis goes someway to restore the natural economics of commerce and avoid mass unemployment. Having said that, there is still a long way to go before we can see a way to Pre-Covid economic stability.”
