Furlough to end and new job retention bonus scheme revealed
Furlough is to be wound down and succeeded by a new Job Retention Bonus Scheme, costing up to £9bn, the Chancellor has revealed today.
Rishi Sunak has just released a summer statement detailing the future of the Government’s COVID-19 support for workers and businesses.
Key announcements were made about the end of the Coronavirus Job Retention Scheme, as well as new support for employers who bring back furloughed staff.
Sunak pledged that “no one will be left without hope” and the Government will “do what is right”.
He added: “Where problems emerge, we will confront them. Where support is justified, we will provide it. Where challenges arise, we will overcome them.”
Below, we’ve summarised a few of the key changes that HR professionals must be ready to adapt.
The end of the Coronavirus Job Retention Scheme
While there was speculation whether the Coronavirus Job Retention Scheme would be extended, the Chancellor confirmed that it will be ending as planned in October.
Sunak added that “endless extensions to furlough are as irresponsible as ending it overnight at the end of June. It creates false hope that it will always be there.”
The introduction of the Job Retention Bonus
While the initial support may be ending, a new scheme was simultaneously announced to reassure employers in the coming months.
Employers will be offered a new Job Retention Bonus of £1,000 for every furloughed employee who is brought back and employed all the way through until January.
Mr Sunak said: ‘If you stand by your workers, we will stand by you,” adding: “this could be a £9bn policy to retain people in work”.
There are conditions attached, however, for firms to qualify. The employee must be paid a minimum of £520 each month through to January.
It’s predicted that those who will be impacted most by the COVID-19 crisis are 16 to 24-year-olds.
To support them, a new Kickstart scheme has been announced that will directly pay employers to create new jobs for any 16 to 24-year-old at risk of long-term unemployment.
“These will be decent jobs – with a minimum of 25 hours per week paid at least the National Minimum Wage,” Mr Sunak added.
The Government will cover the cost of those on the scheme working 25 hours per week for the National Minimum Wage, allowing employers to top it up as they see fit.
How can IRIS HR Professional help?
With everything changing in the upcoming summer statement, it’s easy to feel overwhelmed, as the task of managing all these employee-centric schemes will require a significant amount of time and resources.
Don’t worry, we’re here to help. Following news today of these schemes, we’ll be sure to update you when further information is released.
In the meantime, check out our Support Hub for more information on everything COVID-19 related.
If you’re looking for a solution to meet these ever-changing requirements, check out IRIS HR Professional, which provides a smart and cost-effective way to help your employees thrive.