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Government should extend furlough scheme

Makbool Javaid, Partner - Simons Muirhead & Burton

An open letter from CIPD Chief Executive Peter Cheese to chancellor Rishi Sunak has called on the government to extend the furlough scheme beyond March as reported by People Management.

“We have been consulting with HR leaders, particularly from those in sectors hardest hit by Covid-19, [and] the message that has come back strongly is that an extension beyond March will be needed to help prevent further significant redundancies given the uncertainty around both the pandemic’s trajectory and the timing and speed of any economic recovery,” Cheese said in the letter.

Under the current iteration of the scheme, the government pays 80 per cent of furloughed workers’ wages for hours not worked, capped at £2,500 per month, while employers are only expected to pay pension and national insurance contributions. Employers pay workers as normal for hours worked.

Peter Cheese said government contributions to the job retention scheme should remain at 80 per cent throughout February and March, only dropping to 70 per cent in April and then 60 per cent in May and June.

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