What are the options for your staff once furlough ends?

The Coronavirus Job Retention Scheme or furlough scheme has been a financial lifeline for many businesses since the coronavirus outbreak in the UK. It has taken away the financial burden from business owners of having to pay staff wages while the business is closed, or service output is extremely limited.

9.6 million workers have been furloughed by 1.2 million employers since March. Since 1 August, employers using the scheme have paid National Insurance and pension contributions for their staff. In September, employers will also have to pay 10% of furloughed employees' salaries - rising to 20% in October. The scheme ends at the end of October.

So what are the options once furlough ends?

When the scheme ends, everyone will be wanting for their business to go back to ‘normal’, however many are likely to see significant changes to the way they work. It’s important to use the time now to start to think about how the business might look post furlough.

Understand your expected productivity and staffing requirements

The biggest area to consider is how operational restrictions are affecting your business:

  • Is productivity increasing or reduced?

  • What are the factors that affect productivity?

  • Are they likely to change?

With these points in mind you can begin planning for the coming autumn and winter. You can start to build a picture of your businesses resource requirements, for example will you need fewer employees? Or employees doing different jobs? Can you afford to pay everyone in full or do you need to make changes?

It’s important to remember that the government will pay businesses a £1,000 'job retention' bonus for every furloughed employee they keep on until the end of January 2021. These workers must be paid an average of at least £520 a month between November and January.

What could the alternatives to redundancy look like?

Alternatives to redundancy should always be considered. Your employees will contribute to this should you have to take the redundancy route. You can start to think about the future for your business:

  • Are there new areas of the market you should be developing?

  • Is there an online market you could explore?

Get your senior team together and let them be as creative and radical as possible – you need ideas that will help take your business forward in the new normal. After all, what is there to lose? This may be about saving your business or part of it. Everyone involved will be motivated to help with this.

How could training and education help you to retain your staff?

If you’ve identified an opportunity for your business but your current staff don’t have the skills required, retraining or upskilling them could be the solution. Not only would you save on the time and expense to recruit those skills into your business, but your current teams have the intangible assets of knowing what it’s like to work in your business. They already know the systems, processes, your work culture etc.

Once you have identified what business opportunities you have and any skills gaps which exist, you can start to consider how to adapt your workforce to suit e.g. how you could retrain or redeploy people.

It is worth putting a training plan together to consolidate what is needed and where it can be found and what the costs and timescales are.

There's lots of training available online – you could use our e-learning courses to help you set up a health and safety consultancy for example.

Don't forget - anyone can benefit from the free trials we offer on every course! Simply register for a free trial account and access the first module of all the courses you are interested in. Find out more here.

How could reduced hours work as an alternative to redundancy?

You may have identified that expected levels of productivity simply do not warrant the level of resource you currently have. Before moving straight into a redundancy process, have you considered the option to reduce the hours worked in the affected areas?

Maybe you just need to reduce everyone’s hours in the short term to help you establish what is required and give you a bit of financial breathing space. Most people will respond positively to a request to take a pay cut to try to save the business for the long term.

Only if none of this works should you consider redundancy. The redundancy process is not a quick fix or a short-term money saver, in fact it can be expensive in the short term – more on this next week.

Do you have any questions you'd like to discuss in confidence?

We understand that being an employer in the current economic climate isn't easy. If you've benefited from using the furlough scheme you may be feeling anxious about what happens once the scheme ends in October.

Our team of HR consultants are here to help. Email us at hr@hjssolutions.co.uk or call 01722 325833 and we'll help answer your questions.

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