What’s the impact to HR?

Exit stage left Furlough, enter Job Support Scheme.

Today Chancellor Rishi Sunak announced the Job Support Scheme to top up the wages of employees unable to work full-time because of coronavirus restrictions over the next six months. The new scheme is less generous than the furlough scheme, which is planned to end on 31^st October.

The emphasis is on topping up pay for employees who will only be eligible if they work at least 33% of their normal hours (what is normal ??). For the hours not worked the Government and the employer will each pay one-third, meaning that employees will receive at least 77% of their pay.

The scheme is very similar to Germany’s ‘Kurzarbeit’, or short-work, scheme, under which German employers can put their staff on reduced hours and the government pays a proportion of their wages for the time they are not working.

The burden for managing and calculating this new scheme sits squarely on the shoulders of employers and their HR teams. As businesses exit the furlough scheme on 31^st October and enter the Job Support Scheme on 1^st November, they will need to prepare. The time, cost and risk to HR teams shouldn’t be underestimated, some considerations:

• Transitioning from furlough pay to the Job Support Scheme – calculating pay each month comes with a different set of rules to deal with furlough in September and October, and then Job Support Scheme from November 2020
• For the first three months of the scheme the employee must work at least 33% of their “usual hours”. After 3 months, the Government will consider whether to increase this minimum hours threshold
• Calculation of “Usual Hours” – although the government has said this will follow a similar methodology as for the Coronavirus Job Retention Scheme, guidance and full details are yet to be set out by the government
• Employees will be able to cycle on and off the scheme and do not have to be working the same pattern each month, but each short-time working arrangement must cover a minimum period of seven days. It is not yet clear how this will work in practice
• The challenge of employee communication and engagement as staff transition from furlough to Job Support
• Managing risk of staff morale and redundancies
• Ongoing Health checker for all staff, including self-reporting and eligibility to work based on health
• Ensuring that ongoing calculations of statutory sick pay are aligned with the changes in government policy

For any business struggling to manage these complex calculations, please get in touch with our HR rapid-response team info@elementsuite.co.uk