End of the furlough scheme: What happens next?

With the end of the furlough scheme on September 30 around 1.5 million people are faced with a change in circumstances – return to their job on full pay, or be made redundant.

If you’re still on furlough and haven’t heard from your employer, you should contact them as soon as possible to find out what will happen to your job. If you’re unsure what will happen next, we can take you through your options. 

When furlough was introduced at the start of the pandemic, the government contribute 80 per cent of pay, up to a cap of £2,500 a month, for hours not worked.

This then fell to 70 per cent, up to £2,187.50, from July 1, before dropping again on August 1 to its current level of 60% contribution for hours not working, capped at £1,875.

From October 1, employers will have to pay formerly furloughed workers’ pay in full, or consider whether they still wish to employ them.

“The (furlough) scheme has prevented the UK experiencing catastrophic levels of unemployment, and its extension to 18 months – at a cost of £70 billion – has been worth every penny.” said Dan Tomlinson, senior economist at the Resolution Foundation.

However, hundreds of thousands more workers will be looking for work and older workers in particular face the risk of unemployment or early retirement as they are the most likely to still be on furlough.

Here we lay out exactly what’s ahead for those on furlough, what your rights are and what to consider if you’re being made redundant. 

The Big Issue’s Ride Out Recession Alliance is committed to helping people stay in work, keep their homes and ultimately prevent a tidal wave of Covid-19 homelessness this winter.

If you’re returning to your job

Returning to your job after an extended period of time away will likely feel daunting for many. You may be worried about what colleagues will think, or that you won’t be able to cope.

If you were on flexible furlough, your employer will be required to pay you at their usual rate of pay for all hours and days going forward.

Mind, the mental health charity, recommend making a plan with your employer to make the transition easier, particularly if you are concerned about the impact on your mental health. 

You may have been working from home while on flexible furlough, and with furlough ending, some employers see this as the right time to require employees to come back to the office. 

PM Boris Johnson recommended a “gradual return” for staff who’d worked remotely during the pandemic, and businesses still have a legal duty to manage risks to staff and customers.

Around half of people did not return to work some of the time on flexible furlough, and for those people returning to work may be particularly daunting. Your employer may adopt a hybrid working model in which you continue to work some days from home.

If you’re redeployed in another role

Employers who have built up more than two years’ service are protected from being unfairly dismissed, in line with the Employment Rights Act 1996.

This means that an employer must make sure there is a genuine reason for making the employee redundant, and should ensure that they have no alternative employment they could offer you.

This could mean that they might seek to redeploy you within the company or offer different terms of employment such as a change to hours, shift patterns or job responsibilities.

If your employer makes a change to your contract without first getting your agreement, you may have the right to refuse to work under the new conditions. 

Many companies have had to force through cost-cutting measures to stay afloat during the pandemic, – including using fire and rehire tactics against workers, to force them to accept worse contracts. 

Under current rules, there is no specific legislation to outlaw fire and rehire, but you could join a union in the sector where you work to try to fight it. Joining a union allows workers to organise and bargain collectively, potentially improving negotiation power.

I’m still at risk of redundancy. What can I do?

Check if your potential redundancy is fair

Workers are protected from discrimination and from being selected for redundancy for an unfair reason like pregnancy, working part-time or having previously made a complaint about health and safety.

Using the usual selection criteria (e.g. measuring performance) may also be unfair if some of the workforce has been off work for the last few weeks or months for childcare, caring responsibilities, or shielding reasons, says charity Working Families.

Read up on how much redundancy pay you could be entitled to

Under law, there is a minimum statutory redundancy pay you should receive if you’ve been an employee for two years, and it depends on your age.

If you have worked for your company for less than two years or are self-employed, you’re not entitled to it. Bear in mind you could be denied statutory redundancy pay if you turn down a suitable alternative job from your employer without good reason.

If you are furloughed and likely to be made redundant soon, remember your redundancy pay should be based on your full wage, not what you were paid while on the furlough scheme (if you were paid 80 per cent of your wages while on furlough).

Check for what holiday pay you could be entitled to

Your employer can tell you to take any leftover holidays but must give you notice that’s at least twice as long as the leave they want you to take.

Check your notice period

If you’ve worked for your employer for between a month and two years, you’re entitled to a week’s notice. If you have been employed by them for more than two years, that goes up a week for each full year you have been there to a maximum of 12 weeks. Remember the notice period only starts when you’re formally told you will be made redundant and gives you a finishing date, not when told you’re at risk of redundancy.

You could be entitled to paid time off to look for work

If you’ve worked for your employer for two years at the end of your notice period, you’re likely to be able to claim “reasonable” time off to apply for jobs or go on training. You can take the time off at any time in normal working hours – up to 40 per cent of a week’s work – and your employer can’t ask you to rearrange your work hours to make up the time off.

Check if you get legal expenses cover through your home insurance

It could mean you get free legal help to challenge your redundancy if you think it’s unfair. And if you have a trade union at work, contact them for advice and potential representation. An employer must consult with a trade union or staff reps if more than 20 people are made redundant.

Remember being at risk of redundancy doesn’t necessarily mean you will lose your job

It could mean your employer redeploys you in another role. Consider contacting Citizens Advice if you need more support.

Getting on the job hunt

Like hundreds of thousands of people, you could find yourself looking for a new job for the first time in years.

Watching job applications go unanswered or endlessly tweaking cover letters and CVs is stressful for anyone,but after The Big Issue spoke to experts on how to drive down stress levels and get on top of applications, they told us;

There’s no reason to panic in the post-Covid job market.

There has been a power shift from employers to employees in the market, with a record 1 million UK job vacancies in the three months to August for the first time ever, according to the Office for National Statistics.

That means now is the perfect time to find a suitable role, negotiate the salary you deserve, and integrate things like childcare or flexible working with a strong hand as businesses desperately seek workers.

Here’s what you need to know about how to reduce job hunting stress as furlough ends.

If you’re considering retraining or reskilling

You may be questioning whether your job is still the right one for you, and you are not alone. Whether you have been made redundant or do not wish to return to your old job, now might be the time to change career.

One in six small business owners are worried that at least half of their furloughed workers will choose not to return when the scheme finishes, including nine per cent who say that none of their furloughed workers will opt to come back, according to research by iwoca, Europe’s largest small business lender.

The pandemic encouraged more people, particularly those in later life, to reassess their interests and skills and retrain for new industries. 

It’s never too late to start again and retrain for a new industry. Here’s how you can choose a new career path when you’re over 50. 

In an attempt to cushion the end of furlough for over a million people, Chancellor Rishi Sunak has ring-fenced £500m for schemes and support to help people back to work.

The package will prioritise helping furlough-leavers and those receiving universal credit to find work. It includes some surprising initiatives such as 2,000 elite artificial intelligence scholarships for disadvantaged young people

Sunak has also extended the kickstarter scheme to fund six-month work placements for people on universal credit (UC) who are at risk of long-term unemployment, so this may be an option if you think you will need UC credit at the end of furlough. 

The Big Issue is fighting the unemployment crisis through the Ride Out Recession Alliance, bringing together the most innovative ideas and experts to help keep people in work and in their homes during the recession. Get in touch with what you think can be done to support those in need by emailing rora@bigissue.com.

Career tips and advice from our Jobs and Training series:

• How to change your career – A step-by-step guide
• Employee rights in the UK: Everything you need to know
• Redundancy rights: Everything you need to know
• How to write a CV that will get you a job
• Job interview questions: What to ask and how to answer
• CV templates: Free downloads for job application success
• What to do if you’ve been made redundant
• Apprenticeships: Everything you need to know
• Apprenticeships: How to get a job once your placement ends
• Redundancy: Surviving the mental health impact of losing your job
• 11 tips to help you make the most of online learning
• How to go self-employed in the pandemic
• Budgets, benefits and tax breaks: Money advice for young people after Covid
• The top job adverts to look out for as lockdown eases