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Sunak offers new incentives to keep on ‘viable’ jobs over winter

By John Hyde  >>

Law firms that furloughed staff during the lockdown are being offered partial support in keeping those staff on over winter.

Chancellor Rishi Sunak today outlined plans for additional support once the furlough scheme finishes at the end of next month. He pledged from 1 November to protect ‘viable’ jobs in businesses who are facing lower demand over the winter months due to coronavirus.

But Sunak also made clear that jobs which are no longer necessary post-lockdown cannot be protected indefinitely, and the government could not be expected to save every role.

Many law firms, including those in the UK’s top 50, took advantage of the furlough scheme applying in particular to support staff who were not able to work with offices closing down because of the coronavirus pandemic. They face continued uncertainty this winter following prime minister Boris Johnson telling office workers they should work from home if possible to curtail the spread of the virus.

Sunak said that in order to qualify for the new scheme, employees must be working at least 33% of their usual hour, with the level of grant calculated based on their usual salary. Employers will continue to pay the wages of staff for the hours they work – but for the hours not worked, the government and the employer will each pay one third of their equivalent salary.

The government says measures will apply to all small and medium sized businesses, with larger firms only qualifying if their turnover has fallen through the crisis. Businesses that did not previously use the furlough scheme will be eligible to use the new support.

‘The furlough was the right policy at the time we introduced it,’ said Sunak. ‘It provided immediate, short-term protection for millions of jobs through a period of acute crisis.

‘But as the economy reopens it is fundamentally wrong to hold people in jobs that only exist inside the furlough.

‘We need to create new opportunities and allow the economy to move forward and that means supporting people to be in viable jobs which provide genuine security.’

At the beginning of April, accountants Saffery Champness reported that 77% of firms had communicated a furloughing programme to staff, and that number rose to 91% during the month. Of those firms that had furloughed staff, most (almost 60%) had reduced the workforce by no more than 40%, and almost half of those by no more than 20%.

Most leading firms reporting furloughing at least some staff, but had brought the majority of these back by August.

The Law Society today said these latest measures will bring much-needed relief for many law firms, enabling them to survive the winter months, but it stressed that more action is needed.

It called for the Treasury to ringfence the Ministry of Justice budget and commit to annual rises in line with inflation, for the restoration of legal aid funding for early advice and for long-term investment in the future of legal services.

Society president Simon Davis added: ‘The English and Welsh justice system is in the last chance saloon with 10pm fast approaching.

‘Without urgent changes in funding there will be a massive impact on hundreds of thousands of ordinary people who rely on it to seek justice or enforce their rights.’

(Courtesy: The Law Society Gazette)