Government’s Coronavirus Job Retention Scheme launched this week

The Coronavirus Job Retention Scheme went live earlier this week, with businesses able to claim up to £2,500 a month towards staff wages.

Employers can apply for direct cash grants through HMRC’s new online portal – with the money expected to land in their bank accounts within six working days.

Last week the Chancellor announced the scheme will be extended for a further month until the end of June, to reflect continuing Covid-19 lockdown measures.

Adam Marshall, BCC Director General, said, “The opening of the Job Retention scheme is an important milestone for businesses, who can now begin to access the cash they need to pay their staff and protect livelihoods.

“The government deserves credit for the speed, scale and flexibility of its response to the challenges facing our business communities. The focus should now be on delivering this support to firms on the ground.

“Our research indicates that two-thirds of firms have furloughed some portion of their workforce. With April’s payday approaching, it is essential that the application process is smooth and that payments are made as soon as possible. Any delay would exacerbate the cash crisis many companies are facing and could threaten jobs and businesses.”

The CIPD is calling for the government to make the Job Retention Scheme more flexible now it’s been extended, so furloughed staff are allowed to carry out work on reduced hours for their existing employer where possible.

It believes the benefits of doing so include:

• Helping organisations to bring back workers from furlough gradually, which is likely to be necessary if lockdown measures are phased out over time – and because demand in the economy is likely to recover slowly.
• Enabling organisations to flex their workforce more efficiently, taking pressure off non-furloughed staff and enabling furloughed staff to keep engaged and contributing reduced hours where possible.
• Potentially reducing the cost of the scheme to the taxpayer.

Peter Cheese, chief executive of the CIPD, commented, “The Government should be commended for its swift action in bringing in the Job Retention Scheme, which has helped protect jobs.

“However, with the scheme now being extended, greater flexibility needs to be built into it. As it stands, furloughed staff are not able to do any work for their existing employer, meaning organisations which could provide some work for staff on reduced hours are not able to.

“This change would enable employers to bring back workers gradually, which is likely to be necessary if lockdown measures are phased out over time. It could also help bring down the bill for taxpayers, who will ultimately have to fund the cost of the scheme.

“The Government has shown its prepared to adapt and improve its rescue packages for businesses and workers, and needs to do so again here.”

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