7 MILLION FACING FURLOUGH AS SCOTLAND’S DEATH TOLL RISES BY 50 OVERNIGHT
» More than 60% of private sector firms set to sign up » BA, Philip Green and Nissan to take advantage
UP TO seven million private sector workers could have their wages paid by the state as firms flock to sign up to the Government’s coronavirus furlough scheme.
More than 60 per cent of companies have already said they plan to take advantage of it – with over 40 per cent aiming to furlough at least half of their workforce.
British Airways, Philip Green’s Arcadia high-street empire and car maker Nissan are the latest big employers to announce they will use the scheme.
The mass take-up should avoid large-scale redundancies but will leave the Government with a massive bill.
The Treasury estimates it will cost £10billion for every three million people using the Coronavirus Job Retention Scheme for three months.
The scheme will allow employers to claim 80 per cent of furloughed employees’ usual wage costs, up to £2500 a month.
A survey by the British Chambers of Commerce found more than 60 per cent of firms expect to furlough at least some of their workforce over the next week.
That could equate to more than 850,000 companies and as many as seven million workers.
Meanwhile, unions and British Airways have agreed a modified version of the scheme.
More than 30 ,000 staff will be suspended because of a slump in bookings. They will get 80 per cent of their wages paid by the Government – but there will be no cap, with BA paying any extra wages and allowances.
Unite’s national officer for aviation Oliver Richardson said: “Given the incredibly difficult circumstances that the entire aviation sector is facing, this is as good a deal as possible for our members. The deal protects the jobs of BA staff and, as far as possible, also protects their pay.”
GMB national officer Nadine Houghton said: “GMB members working for BA are relieved to finally have some certainty after what has been an extremely worrying time.
“But GMB is calling for more Government intervention to
protect the livelihoods of many more workers across the sector.”
Staff at Arcadia, whose chains include Topshop, Topman and Dorothy Perkins, will also be among those whose wages will paid by the taxpayer while the stores are shut – despite Green and his wife having an estimated fortune of nearly £1billion.
Arcadia’s board and senior bosses will take a 25 to 50 per cent pay cut and chief executive Ian Grabiner will get no salary or benefits until further notice.
Nissan has furloughed most of the 6000 employees at its UK plant in Sunderland, which closed on March 17 and will remain shut for the rest of the month at least.
The car maker said: “Our goal is to navigate through this crisis while maintaining activities critical for continuity and to make sure we are prepared for the time when business resumes and we can welcome the Nissan team back to work.”
A survey published yesterday by the Office for National Statistics found 27 per cent of firms said they were reducing staff levels in the short-term.
But the research was done just days after the furlough scheme was announced and an updated survey in a fortnight will show if it encouraged companies to keep staff on.
Meanwhile, charity Save the Children said 10 per cent of parents have had to leave their jobs to look after their children during the pandemic.
Another 12 per cent have had to take unpaid leave and 17 per cent have reduced their working hours.
Another report found more than 750,000 self-employed people in the UK could miss out on Government support.
The Centre for Decent Work and Productivity at Manchester Metropolitan University suggests sole traders who have recently started up are most vulnerable to a near-total loss of income and said this could “decimate a whole generation of early-stage entrepreneurs”.
The Treasury last night announced changes to extend the scope of firms that can get loans. It came as the UK Government promised that “all viable small firms” hit by coronavirus will be able to get rescue funding.