Calls for a statutory retention pay scheme to save jobs

The Government should create a statutory retention pay scheme modelled on maternity pay to safeguard people’s jobs over the next few months as the coronavirus hits, says a leading think tank.

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The Government should commit a further £22bn to support up to one million workers facing lay-offs, creating a new work subsidy modelled on maternity pay, according to think tank The Resolution Foundation.

It says the statutory retention pay scheme, costed at £3.6bn, would allow firms to put staff on leave without making them redundant, supporting a million workers via a flat rate subsidy to employers worth £151 per week for an initial six months.

The call came as Boris Johnson urged companies to wait until the government announces an additional employment support package before laying off staff. Chancellor Rishi Sunak will unveil the measures today at a press conference.

Johnson said: “Stand by your employees, stand by workers because we will stand by you.”

His comments come after the government was criticised for not doing enough to protect workers from the fallout of the coronavirus outbreak. It is reported that the Treasury is considering reducing employers’ national insurance and the basic rate of income tax.

There have also been reports that the government could subsidise up to 60% of the average national wage for each worker.  Meanwhile former business secretary Greg Clark has called for immediate action through the current UK taxation system, warning that the £330bn loan scheme announced by the government is not enough to prevent firms from making staff redundant. That would involve the government paying people’s wages for the next weeks, with separate arrangements for the self employed.

Many companies have laid people off or reduced their hours and wages, but others are recruiting. The Co-op has said it will create 5,000 jobs within its stores, aimed at providing employment to hospitality staff who have recently lost their jobs.

Waitrose has already announced that it will create 3,500 jobs to boost its home delivery network, while Amazon said it will hire 10,000 workers in the US and will increase pay across the UK, US and Europe.

Morrisons said it will recruit around 3,500 more staff in its distribution chain. Iceland, Tesco and Lidl have all announced they will hire additional workers. Meanwhile, farmers have called for British retail, hospitality and catering staff who have lost their jobs to take up employment picking fruits and vegetables.

And as part of emergency measures to strengthen the NHS amid the coronavirus outbreak, 65,000 former doctors and nurses are being called on to return to work. In addition, medical students and student nurses in their final year are being offered fully paid, temporary roles in the NHS to help the healthcare service deal with an expected surge in patients.

Those vulnerable to the virus will not be expected to rejoin the workforce. Retired police officers could also be called back into work as concerns are raised that up to a third of the workforce could become sick or forced to self-isolate. Local authorities will also be given £1.6bn in funding to boost the social care workforce.

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