There had been rumours the Chancellor would continue with furlough to protect jobs after the government announced further pandemic restrictions.
Instead, there will be a new job support scheme (JSS) under which the government will top up salaries for six months from 1 November. Employee must work at least one-third of their normal hours, and the employer and government will each pay one-third of the wages for the hours not worked.
The government contribution will be capped at £697.92. The scheme is open to businesses with 250 employees or less, or to large businesses that can prove their revenue has fallen because of COVID-19.
Will Clayton, partner at employment law firm Constantine Law, said the timing of the Chancellor’s announcement on furlough meant ‘time is extremely tight’ for employers who need to make 20 or more redundancies. ‘For employers who may need to shed 100 or more currently furloughed employees, unless they have already started collective consultation with employee representatives, they will not be able to lawfully serve notices to dismiss until around mid-November at the earliest’.
Clayton said the Chancellor was ‘taking a real gamble’ with his job support scheme. ‘For example, will a restaurant that employs nine waiting staff put all of them on 33% of their hours and volunteer to share the costs of covering 66% of the shortfall with the government? Or will they instead make six members of staff redundant and keep three fully employed, without the costs of the JSS subsidy?’
