Lockdown is an uncertain time for everyone across the UK, with Britons told to remain at home, businesses closed and schools shut. The knock-on effect for businesses has been devastating, with some facing months of being unable to trade. However, the Government’s furlough scheme was introduced in a bid to stop an unemployment crisis in the wake of the pandemic.
Furlough was introduced during the first lockdown period in the UK, helping businesses pay the wages of staff who cannot work or have been placed on leave due to the pandemic.
The scheme pays employees who are not working but are still kept on by their employer.
This can be due to lack of hours, the business closing or to help parents who need to care for children during lockdown.
Those on furlough receive up to 80 percent of their salary up to a maximum of £2,500 a month.
Read More: Can I ask to be furloughed?
Employers can then top up wages by the remaining 20 percent if they wish, but have to pay for pension and National Insurance contributions.
The furlough scheme has been extended a couple of times, when it was clear the disruption from the pandemic was not a short-term problem.
Now Chancellor Rishi Sunak has extended the furlough scheme until the end of April 2021, with England in lockdown until at least the middle of February.
And business leaders have said they will be putting pressure on the Government to deliver vaccine promises in order to limit the economic damage of the latest national lockdowns.
The Government advice on furlough says: “If you flexibly furlough employees, you will also need to agree this with the employee (or reach collective agreement with a trade union) and keep a new written agreement that confirms the new furlough arrangement.”
So, you can work some hours while on furlough, so long as they don’t extend into the hours you are being furloughed for.
To put it simply, you can be a full-time employee and work part-time with the other portion of your wages paid by furlough.
Employees who only work part-time can also be furloughed, and will receive 80 percent of their usual wage via the scheme – with an optional 20 percent top-up from their employer.
For those with more than one job, you can be furloughed for each job if needed.
The Government site explains: “Employees can be furloughed in one job and receive a furloughed payment but continue working for another employer and receive their normal wages.”
There will be a rocky few months ahead for businesses as the third national lockdown gets underway.
Chancellor Rishi Sunak announced on Tuesday that around 600,000 retail, hospitality and leisure sites will be able to claim a one-off grant of up to £9,000.
Neil Carberry, chief executive of the Recruitment and Employment Confederation said this package is “of course welcome” but “falls short in a couple of key ways” because like financial support during the March lockdown, it is “aimed at those businesses the Government has specifically required to close” while overlooking their suppliers who are facing “severe cash flow challenges”.
He said: “A more comprehensive package is going to be needed to support businesses through this.”
“Businesses are looking for a long-term strategy… not just how do we step back from the furlough scheme as lockdowns ease, but what sort of support is necessary to get firms hiring again.”
He added easing national insurance payments for employers with furloughed staff, particularly those in the hospitality industry, will help preserve jobs.