Thousands of workers have lost chance to be furloughed because of change to Job Retention Scheme

Eleventh hour changes to the government’s Job Retention Scheme will mean thousands of workers who can’t currently work because of the coronavirus crisis will lose out on being furloughed Prospect union has warned.

People whose contracts expired in March and early April are no longer able to be furloughed because of this change. Freelancers who work on weekly contracts will be particularly affected because of the change and will be forced to rely on Universal Credit. These contracts are common in sectors like TV, film, archaeology and heritage.

Prospect writes to the Chancellor

Prospect General Secretary Mike Clancy has written to the government urging it to change its guidance. Prospect is calling for any worker in an employment contract between 28 February and 19 March to be able to be furloughed, regardless of whether the contract has now finished.

The scheme will open for employers to make claims on Monday.

Mike Clancy, Prospect general secretary said:

“Despite what the Chancellor has previously promised, workers on fixed term contracts which expired during March and early April will now be left out the job retention scheme and cannot be furloughed.

“As a result, these workers will be reliant on small payments from an overstretched benefits system rather than receiving 80% of their salary, potentially pushing them into poverty.

“This is both unfair and unjust and it must be urgently addressed by the government.

“This will affect thousands of workers in film, TV, heritage, archaeology and other sectors where many people work on multiple weekly contracts.

“But by breaking the link between workers and their workplaces it will also make the recovery much more difficult. This is lose-lose for these workers and the country as a whole.

“The government need to engage properly with unions as changes are being made, as constant updates risk turning comfort into anxiety.”

Prospect represents tens of thousands of freelancers in a range of sectors including heritage, archaeology, children’s services and as part of our Bectu sector in film, TV and the arts.

The new guidance from HMRC

If your employee is on a fixed term contract

Employees on fixed term contracts can be furloughed. Their contracts can be renewed or extended before their natural conclusion during the furlough period without breaking the terms of the scheme. There is no minimum period which must be left to run on a fixed term contract to enable it to be renewed or extended, but it must not have ended. The furlough period must be for a minimum period of three consecutive weeks. Where a fixed term employee’s contract ends because it is not extended or renewed before its natural conclusion you will no longer be able claim grant for them once the contract ends. Fixed term contracts which ended, without extension or renewal, on or before 19 March 2020 will not qualify for the grant once they have ended. See: https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme