Chancellor Rishi Sunak has made extensions to the furlough scheme since the Covid pandemic began, with its latest end date drawing near
The furlough scheme has been championed as protecting millions of jobs across the UK since it was introduced at the start of the Covid pandemic.
The initiative, officially known as the Coronavirus Job Retention Scheme (CJRS), has paid 80% of some employees’ salary up to £2,500 a month for hours not worked throughout the coronavirus crisis.
The government’s furlough scheme is currently scheduled to end on 30 April 2021 – more than a year since it was first introduced as a way of avoiding mass redundancies due to the virus.
The scheme has been used by employers in all four nations, with more than nine million people on furlough during the first peak of the virus in the spring and summer of 2020.
It has come at a heavy price to the public purse, however, with the complete support package costing in the region of £200 billion, including additional tax deferrals and grants for businesses.
Who can be placed on furlough?
All employees – be it full time, part time, agency, flexible or zero hour contracts – can be placed on furlough, as long as the individual was on the company’s books before the scheme was last extended.
Those employees furloughed are often people who cannot do their jobs because their workplace is closed, there is not enough work for them, or they can’t do their jobs due to impacts of the virus elsewhere in the supply chain.
Employees maintain their worker rights, such as annual and parental leave, and individuals can take on other jobs as long as it doesn’t break the rules of your contract with your main employer.
Parents and carers with responsibilities, as well as clinically extremely vulnerable workers who cannot leave their homes, are also eligible to be placed on furlough, and are advised to speak to their employer.
Workers can be brought off furlough part time or completely when their employer deems it necessary, leading to a restructuring of payments made from the government in reflection of hours worked.
Could furlough be extended?
The furlough scheme has been extended before as the virus maintained its grip on society throughout 2020, meaning some businesses couldn’t open, reopen fully or had to close again due to government guidance.
It was last extended on 5 November in response to high infection rates and an increasing number of people in hospital with Covid, with the chancellor of the exchequer Rishi Sunak outlining the reasons why.
He said: ”I’ve always said I would do whatever it takes to protect jobs and livelihoods across the UK – and that has meant adapting our support as the path of the virus has changed.
“It’s clear the economic effects are much longer lasting for businesses than the duration of any restrictions, which is why we have decided to go further with our support.
“Extending furlough and increasing our support for the self-employed will protect millions of jobs and give people and businesses the certainty they need over what will be a difficult winter.”
Why might furlough be extended?
Yet the plan, which is dependent on vaccination targets, hospital admissions and Covid variants, will see businesses reopen at different dates over the coming weeks and months.
Non-essential shops and businesses, including gyms, hairdressers, retail and outdoor hospitality, aren’t expected to reopen until 12 April at the earliest, Mr Johnson said.
Unions are warning of a cliff edge for employers and workers when the support scheme comes to an end at the end of April, with an estimated 4.5 million people still on furlough.
People who work in the hospitality and retail sector are thought to make up a large proportion of this number, as the wait for their employers to reopen continues.
Mr Johnson has said the government will “not pull the rug out” from people relying on financial support. It is reported that an update on furlough is expected on 3 March during the Budget.