Coronavirus: Furlough Cut-Off Date Expected to be Announced

Today, the FT reports that the Chancellor is set to announce a date after which it will not be possible to furlough any employees.

From August onwards, the Scheme is changing so that organisations will be able to bring back employees part-time, though they will also be expected to begin to contribute wages of employees.

The move to stop new employees being furloughed is to prevent a flurry of applications to furlough employees full-time to get the benefit of having more employees working part-time in the long term.

Organisations who have yet to furlough staff but anticipate needing to do so prior to October should consider whether they should furlough staff in the short- to medium-term.

DMA CEO Chris Combemale said:

"The Furlough scheme has been a hugely successful programme that has prevented the collapse of thousands of businesses and unemployment of swathes of businesses.

While the scheme must draw to a close at some point, the chancellor should give business as much notice as possible in order to plan effectively. Taking away these temporary buttresses too soon could undermine the purpose of the various government help schemes."

Earlier in the week, the UK Government announced further easing of lockdown in England to begin from 1 and 15 June. The Scottish, Welsh and Northern Ireland are to give further details later this week.