07 Jul Coronavirus: returning furloughed staff
How small businesses should address bringing staff back to work under the flexible Coronavirus Job Retention Scheme.
For SMEs looking to rebound from the effects of lockdown, the announcement of the flexible Coronavirus Job Retention Scheme (CJRS) is a welcome fillip. Allowing employers to bring staff back part-time, while still receiving government payroll support, will mitigate some of the economic risks for smaller businesses with tight margins and depleted cash reserves from riding out the coronavirus storm.
“The new scheme will be helpful for businesses as they begin to reopen but don’t have sufficient work to fulfil the full contracted hours of their workforce,” says Avril McGuire, employment law consultant at Mentor.
From 1 July, employers can re-employ furloughed staff on a part-time basis. The government CJRS scheme website offers on an online calculator to help employers work out part-time salaries for furloughed staff.
From 1 August, employers will be required to pay NI and pension contributions. From 1 September, they will pay 10% of furlough pay (up to £312.50), rising to 20% (up to £625) in October, the final month of the CJRS.
This staggered approach provides a safety net over the coming months, but business owners will need to consider how to minimise the economic impact, support returning staff, and reassure customers and suppliers that it is business as usual. New health and safety regulations need to be adhered to, home workers set up, and on-site practices modified.
The first consideration will be the cost of bringing back furloughed staff. “It’s understandable that businesses may be concerned about financial difficulties as government support for employee wages comes to an end,” says McGuire. To make the most of the flexible furlough scheme, SMEs need to evaluate which employees to bring back, and for how long.
There is no specification in the CJRS on who can return, or the hours they work.
“Employers should consider how much work is available to determine how many employees they continue to furlough, or whether other action is required,” advises McGuire. “They may consider laying employees off – where they have the contractual right or written agreement. In some cases, redundancies may be unavoidable to save costs.”
There may be alternative ways to minimise staffing costs, however. “Some employees might consider reduced hours or pay if this means that redundancies can be avoided,” says Hannah Gibson-Patel, senior HR consultant at RSM.
“If they can work from home and reduce expenditure on commuting, this may help with negotiations. And parents may be willing to take periods of unpaid parental leave.”
Before altering working hours or practices, check you’re within the bounds of employment law. “Terms and conditions of employment can be changed, on a temporary or permanent basis, with the agreement of employees,” says McGuire. “Imposing changes without agreement is more complex, but if there are strong business reasons to do so, it can be achieved through a formal process of consultation, dismissal and re-engagement. Legal advice should be sought if employees don’t agree to the proposed changes.”
In order that staff are willing and able to return, businesses need to communicate with them about how, where and when they are expected to work.
“There is no legal requirement to provide advance notice to employees when they are required to return, but it’s good practice to give them as much notice as possible to make necessary arrangements,” says McGuire.
Communicate directly and encourage discussion; cover the reasons they are needed; what they are expected to do; the social-distancing arrangements; and follow up via email. “Think about how to ease the transition,” adds Gibson-Patel. “Ensure clear signage is in place, send out instructions about access to premises, and maybe create a video walk-through of the new requirements so employees can mentally prepare.”
To be sure that your workplace is safe, check the relevant government guidelines and carry out a risk assessment. Consider how many employees should work at once, and whether to stagger arrival and departure times. How staff get to work, and when they can safely travel, will factor into this.
“We shouldn’t overlook the small things that will require adjustments,” says Gibson-Patel. “Consider anything that can be done to help establish new routines, such as visual aids for use of PPE, automatic prompts to carry out cleaning, and daily briefings to update on any changes. Encourage feedback on what is or isn’t working.”
Official guidance states that if a job can be done from home, it should be. If previously furloughed employees are to start working from home, set them up to do so.
“If staff are returning to a homeworking arrangement, employers need to ensure the right technology and equipment is in place for them to be able to effectively work – in advance of their first day back,” says Gibson-Patel.
A recent poll by CIPD found 44% of respondents felt anxious about going back to work because of the health risks posed by coronavirus, and employees are likely to need mental and emotional support following a prolonged period of furlough.
“This is an uncertain time for everyone, and this may have an effect on employees’ mental health,” says McGuire. “Employers could put a well-being programme in place, involving activities aimed at reducing stress and anxiety; introduce an employee assistance service; or make employees aware of charities they can refer to.”
There are a variety of organisations offering training on stress resilience in the workplace, so research the available programmes to suit your business and budget. For guidance on managing the effects of coronavirus on your business, visit NatWest Mentor .
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