Businesses leaders representing over 100,000 UK businesses have written to the Chancellor to make sure that the design of the Coronavirus Job Retention Scheme does not put the jobs of the UK’s most vulnerable workers at risk.
The Chancellor announced this week that the Coronavirus Job Retention Scheme (aka. Furlough Scheme) would be extended to October, but employers could be asked to contribute more from August. There is already recognition that some sectors, such as hospitality and tourism, are unlikely to be operating by then but there is also a danger to vulnerable workers who are shielding from COVID-19.
The Government has said that there are 2.5m people are shielding from Coronavirus, hundreds of thousands of whom will be in employment. A report from University College London estimated that there are up to 8m people with underlying health conditions that could also be at risk when going to work and should also be shielding.
Some employers are more at risk than others, even in sectors such as manufacturing which are now being encouraged to go back to work. Businesses which specialise in employing vulnerable workers, such as supported businesses, social enterprises and social firms are at potential risk of closure if drastic changes to the furlough scheme are made in the coming months.
This is not an isolated issue, there are over 10,000 social enterprises for whom vulnerable workers such disabled people, care leavers, recovering addicts and ex-offenders make up more than 25% of their workforce. These join hundreds of supported businesses, social firms, community businesses and other employers for whom vulnerable workers make up a significant portion of their workforce. Whilst their competitors may be back to close to normal operations, these businesses will struggle to return to full capacity as their staff will need to maintain shielding. As a consequence they will not have the cash to pay a higher proportion of staff wages.
Without flexibility in the Furlough Scheme, these employers will have to make difficult choices about letting vulnerable staff go if they are asked to contribute more to their wages whilst they are not able to work. For those businesses which exist to support vulnerable workers, such as supported businesses, they face closure if they cannot get access to further support from government.
Writing to the Chancellor, business leaders have said:
“If these specialised businesses are lost, their employees and thousands of future employees will struggle to re-enter employment, at a considerable long-term cost to the taxpayer.”
Commenting on this issue and the letter, Lord Victor Adebowale, Chair of Social Enterprise UK said:
“The Government has done the right thing in supporting employers during this difficult time, but as we ease lockdown, we are entering a potentially dangerous phase for employers of vulnerable workers. Without flexibility in the winding down of the Furlough Scheme, the good work that has been done in recent years to help disabled people, those recovering from addiction and helping ex-offenders back in work could be undermined. These workers could take years to get back into work with a huge impact on their wellbeing as well as creating higher costs to the taxpayer.”
“The government needs to work with employers to put in place a targeted approach to winding down furlough payments for vulnerable workers. Contributions should only increase when they are in position to get their businesses back up on their feet to protect jobs.”
Kate Bull, Managing Director, Britain’s Bravest Manufacturing Company – a manufacturing social enterprise and supported business which employs veterans and disabled people, said:
“We want to do the right thing to support our workers through this crisis and we cannot rush them back to work when their physical and mental health is at risk. This means that we are not going to be able to get back to business as usual straight away. We need the Government to show a bit of flexibility so that we can protect jobs for people who would struggle to otherwise find work. Workers and society will reap the benefits from this flexibility for years to come.”
Sam Peplow, CEO, Yateley Industries – a registered charity and supported business providing employment and accommodation for people with disabilities, said:
“We are doing our best to get
through this unprecedented crisis and government must be sensitive to the fact
that not every business or employee is the same. What we don’t want to see is
our most vulnerable workers being put out of work because they were overlooked.
Small changes to the Job Retention Scheme will help businesses like mine get
through to the other side so that we can keep disabled people in work with all
the benefits to health, wellbeing and society that come from that.”
- The letter has been signed by Co-operatives UK, Disability Business Forum, Locality, Social Enterprise Mark CIC, Social Enterprise UK, Social Value UK, Supported Business Steering Group, UnLtd. The full letter can be read here
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