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With the Coronavirus job Retention Scheme closing on 31 October 2020 and recent Government announcements reinforcing working at home wherever possible, there is wide concern that more redundancies will take place over coming months.

In recent months we have been helping organisations to make some tough decisions in what is an ever-changing and fragile economic environment. We know that times are tough and whilst redundancies may seem like the only way forward, we stress that this really should be the last resort and that employers should exhaust all possible alternatives before making redundancies. We urge you to try to find other solutions before you start redundancy consultation. These include:

  • More part-time working
  • Job sharing
  • Salary reductions
  • Cuts to overtime / extra hours
  • Reorganisation and offering alternative roles
  • Retraining

If you are about to consult employees about changes to their jobs, then here is some quick advice:

  1. Do it openly: the sooner people understand the situation, the better for everyone.
  2. Do it thoroughly: to understand what’s happening people need information and guidance.
  3. Do it genuinely: consultation means hearing people’s views before you make a decision; so be open to alternatives.
  4. Do it fairly: if you need to consult about possible redundancies, all aspects of your redundancy procedure should be conducted fairly.
  5. Do it with dignity: losing your job has a human as a well as a business cost. The way you let people go says a lot about your organisation’s values. Think about how you will handle the conversation – whether its face-to-face or remote.

As I write this, Rishi Sunak has just addressed the House of Commons to set out the Government’s new Job Support Scheme (JSS), aimed primarily at small and medium sized businesses, or large businesses that can prove they’ve been adversely affected by Covid.

Open to all employers, even if they have not previously used furlough, the new scheme will start in November and run for six months. The JSS replaces the furlough scheme and means that the government will support the wages of people in work, giving employers the option to keep people in work on shorter hours, rather than make them redundant. So, for example employees will have to work at least one-third of their normal hours and be paid for that by the employer.  The government will then top up pay to two-thirds of salary.  (The verbal statement in the House of Commons made no mention of any maximum payments; doubtless that will be made clear in due course).

Other highlights from today include:

  • The self-employed grant is being extended on similar terms and conditions to the new Jobs Support Scheme
  • The cut in VAT to 5% for the hospitality and tourism sector will be extended until 31 March
  • Firms that took government loans during the crisis will have longer to pay them back
  • Companies who deferred their VAT bill will no longer have to pay a lump sum in March
  • A “pay as you grow” scheme was announced for businesses, allowing them to extend their bounce back loans from six to 10 years, reducing their payments
  • Businesses can also move to interest-only payments or suspend repayments for six months if they are “in real trouble”. Credit ratings will be unaffected
  • The government guarantee on Coronavirus Business Interruption Loans will be extended to 10 years and a new successor loan guarantee programme will be announced in January
  • Extra support has been announced to allow people to delay their income tax bill – but it will still need to be paid

Hopefully, this news may be just what you were hoping for. However, If you need help, assistance or guidance to understand the new regulations and how it can work for your business, please get in touch by emailing caroline.robertson@actifhr.co.uk or telephone 01327 317537