Expert Comment: Furlough Extension

The extension of the furlough scheme until the end of March, will leave many businesses and employees of those businesses breathing a sigh of relief as it does mean that more jobs will be protected for longer, and let’s hope by then a resolution of this crisis is either in full swing, or is imminent. That said we do need to remember that the Chancellor rarely gives without taking away, and that was also the case today with news that the Job Retention Bonus would be scrapped for now and replaced with a new “retention incentive” that would be deployed at an “appropriate time”.

Those employers therefore who were hoping for the Bonus – a £1,000 one-off payment to firms that had retained previously-furloughed staff until the end of January 2021 – will be sorely disappointed and much as this “Bonus “ was seen by some as a bit of window dressing, many businesses will have included the prospective receipt of the Bonus in their financial projections. I suppose they can always access the furlough scheme again, and the extension of furlough must be seen in the round as a positive step, however, the constant chopping and changing of timings and staff retention support available makes any realistic future planning very difficult for businesses and their employees alike and if there is one thing the business world hates it’s uncertainty.

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Please contact your usual Monahans representative to discuss this further. We are here to help and more details will follow as further announcements are expected from the Government and HM Treasury.