Furlough and the £1000 Job Retention bonus

jmb1

Hi guys can someone clarify for me. I'm rather confused as I had thought you EITHER take them off furlough now and bring them back to work, and in so doing get the bonus. OR continue furloughing them but get no bonus. But threads read on here suggested you can feasibly do both? As a small business this would be extremely life-saving if true.

I am self employed sole proprietor with one PAYE staff member who have been off work furloughed since the start of the scheme, with me topping up the furlough to 100% salary (£630 take home per month in total). I am intending to continue furloughing to the end of scheme in October and then they will come back to work on full pay from November onward.

Can anybody clarify?

Diamandis

It's for any employee that has been furloughed but remains employed by 31 January. You don't have to take them off furlough now. 

jmb1

Diamandis said:

It's for any employee that has been furloughed but remains employed by 31 January. You don't have to take them off furlough now. 

Thanks. The part that confuses me and seems to contradict that is "If you’re an employer and you bring someone back who was furloughed - and you continuously employ them through to January – we will pay you a £1,000 bonus per employee." That read to me that you have to take them off furlough and 'bring them back' to work. Usual government ambiguity of language!

Galloglass

That read to me that you have to take them off furlough and 'bring them back' to work.

Since furlough ends on 31st October and the employee has to be in employment on 31st January then they will be back to work for 3 months - at least.

jmb1

Galloglass said:

That read to me that you have to take them off furlough and 'bring them back' to work.

Since furlough ends on 31st October and the employee has to be in employment on 31st January then they will be back to work for 3 months - at least.

Ah ha! Clarity, of course you are right. Many thanks to you.

sharpe106

It will cost you more in wages then what you will get back, so fairly pointless. You can either afford to have the person back or you can't the extra £1000 will make no difference. 

jmb1

sharpe106 said:

It will cost you more in wages then what you will get back, so fairly pointless. You can either afford to have the person back or you can't the extra £1000 will make no difference. 

Not quite sure I follow your logic there. I take the staff back, have them work for 3 months (instead of what has been just me working doubly hard to do two jobs), I have to pay them, but I do at least have £1000 to put toward their salary I've been paying for those 3 months. Or am I wrong?

gary83

jmb1 said:

sharpe106 said:

It will cost you more in wages then what you will get back, so fairly pointless. You can either afford to have the person back or you can't the extra £1000 will make no difference. 

Not quite sure I follow your logic there. I take the staff back, have them work for 3 months (instead of what has been just me working doubly hard to do two jobs), I have to pay them, but I do at least have £1000 to put toward their salary I've been paying for those 3 months. Or am I wrong?

You’re not wrong. the point sharpe was trying to make is the futility of the scheme, the govt are giving £1000 to every job that’s safe anyway, the maths doesn’t add up as enough of an incentive to keep someone on for months that you would otherwise let go. The scheme is very poorly targeted, but if your business is viable going forwards and the job still exists you do get a free £1000 bonus.

Galloglass

As I remember the minimum you need to pay each month to these staff is £521**. So (3 x £521) - £1000. Essentially you can get 3 months [minimal] work for the price of 1. 

** Must be at least NMW though

sharpe106

Yeah my point was basically it is very nice for the company but it is not actually going to save the jobs. You can either afford to pay them or you can't the £1000 is not going to keep them employed for very long. 

Waxy666

Galloglass said:

As I remember the minimum you need to pay each month to these staff is £521**. So (3 x £521) - £1000. Essentially you can get 3 months [minimal] work for the price of 1. 

** Must be at least NMW though

Sure it keeps your wages bill low for three months.  But what are the chances that your business remarkably goes from quiet in Oct (such that you were planning to make the role redundant) to full flight by Feb (such that you want to keep them on).  It will just be a nice bonus for businesses that were going to keep their staff anyway, and a huge cliff edge of redundancies announced on 1 Feb 2021.
Look at the 1,000's of redundancies already announced by big names, the government schemes aren't sufficient to offset the fact there just isn't demand or jobs to be done at the moment.  A £1k bonus isn't going to change the fact there is no work to be done.