Member Article

SMALL BUSINESSES URGED TO CAMPAIGN FOR ‘PART-FURLOUGH’ ELEMENT TO GOVERNMENT’S CORONAVIRUS SUPPORT PACKAGE

SMALL BUSINESSES URGED TO CAMPAIGN FOR ’PART-FURLOUGH’ ELEMENT TO GOVERNMENT’S CORONAVIRUS SUPPORT PACKAGE

Small businesses around the UK are being urged to have their say on potential amendments to the Government’s support package for companies hit by the coronavirus crisis.

Outsourced HR specialists The HR Dept are campaigning for an improvement to the furlough system which they say needs urgent revision despite being a life support for many companies.

Employment experts say some businesses are struggling with the ‘all or nothing’ nature of the system. Currently it prevents furloughed employees from doing any work, even though some part-time contributions are needed to keep things ticking over so businesses can be ready to continue at the end of the furlough period.

Without an ability to ‘part furlough’ essential staff, some businesses are therefore struggling with continuity, with resentment rising in employees on reduced pay against their colleagues on 80 per cent of full pay.

The HR Dept, a network of HR experts operating independent franchises around the UK, is now surveying small businesses for feedback on proposals to introduce a part-furlough element to the scheme. More than 300 companies around the UK have responded to questions and the company is urging many more to contribute by the survey deadline at the end of Monday April 27th.

The HR Dept has already raised the issue with key Government personnel and the call for more flexibility has now been adopted by the Chartered Institute of Personnel and Development (CIPD) adding further lobbying power to the proposals.

The HR Dept Newcastle campaign work on this issue has been led by Jayne Hart in based in South Tyneside.

Hart said: “The first thing to say is that the Government’s Coronavirus Job Retention Scheme is an extremely welcome and generous package of support to the business community. However, like any system it has its problems.

“The root cause of the issue is that, as ever, small businesses struggle to get their voices heard in the debate, which tends to be dominated by larger corporates.

“So we are doing all we can to help represent their concerns. As a HR Dept network, we support more than 7,000 SMEs around the UK but we want all small businesses to have their input.

“In 18 years in HR, I have never heard of the furlough system and it’s an exceptional measure. However, there are some serious business issues that have not been addressed. If not acted upon swiftly they will cause significant employee relations rifts, commercial decisions being made for the wrong reasons and a ‘split’ workplace and society, at a time when we have to be more collaborative and deal with this health crisis together.”

The HR Dept has proposed an additional ‘short time working scheme’ and for non-working days to pay not the guaranteed statutory pay of £30 per day (currently at a maximum of five days) but the same 80 per cent rate of daily pay, capped at circa £115 per day.

They have said: “This would be a pragmatic, fair, equitable and much needed solution, that would be welcomed by SMEs and keep the wheels of commerce and industry going, subject to complying at all times with guidance from Public Health.”

The HR Dept’s position has been supported by the CIPD’s head of public policy Ben Wilmott, who was also keynote speaker at the company’s annual conference for franchisees last year. In a blog published on the CIPD website yesterday, Mr Wilmott said: “The UK ‘all or nothing’ furlough approach may be simpler and easier to administrate than a more flexible scheme which enables short-time working but it also has significant drawbacks and disadvantages.  

“Firstly, it does not allow organisations to continue to use staff on reduced hours where this is possible, meaning it is much harder for employers to flex their workforce efficiently, placing more pressure on remaining non-furloughed staff who often have to work harder or in unfamiliar roles to compensate.

“This is a particular challenge for micro and small firms under most financial pressure and with fewer staffing options. This is a concern that has been raised by many CIPD-qualified HR consultants who provide support to small firms. However larger employers would also benefit significantly from staff who are furloughed being able to work from reduced hours, according to conversations we have been having with senior HR directors.”

The HR Dept’s survey on this issue is here https://www.smartsurvey.co.uk/s/JRSFurlough/

This was posted in Bdaily's Members' News section by Jayne Hart .