BUSINESSES who re-employ furloughed staff will get a £1,000 bonus per employee from the government to help keep Brits in work.
The move was announced today by Chancellor Rishi Sunak as part of an incentive for bosses to keep people employed following the coronavirus crisis.
Speaking in what’s being dubbed as a mini-Budget, Mr Sunak said employers will qualify for the Jobs Retention Bonus when they bring someone back from furlough.
To get the bonus, bosses must pay each worker at least £520 per month on average, and continuously employ them through to January 31.
Employers will get £1,000 for each qualifying furloughed worker that they bring back.
The government was previously warned how unemployment will hit five million unless urgent steps are taken to help businesses survive.
This shocking figure is the same as almost one in seven people being out of work, or 14.8 per cent of the population, according to the Organisation for Economic Co-operation and Development (OECD).
The Office for National Statistics (ONS) also released damning new numbers showing at least 600,000 people have lost their jobs nationwide due to coronavirus.
More than 3.2 million people have also started claiming Universal Credit since the start of the lockdown, the ONS data shows.
Around nine million employees have been furloughed due to the pandemic, meaning the government could potentially pay out £9billion to businesses.
The Chancellor also confirmed he won’t be extending the furlough scheme, which is due to end in October.
The government will begin to wean off its support from next month, where employers will be expected to contribute national insurance and pension contributions from August – previously, the government would foot this bill.
Then in September, they’ll have to pay 10 per cent of salaries as well, before this increases to 20 per cent of salaries from October.
The scheme was first launched on March 20 to help keeps Brits employed.
However, employees can still be made redundant while on furlough – sparking fears that thousands of people will lose their jobs if their boss can’t afford to keep them on.
The scheme was initially meant to finish in July but the Chancellor extended this deadline in May – although applicants to join the scheme closed on June 10.
Addressing the House of Commons today, Mr Sunak said: “If you’re an employer and you bring back someone who was furloughed – and continuously employ them through to January – we’ll pay you a £1,000 bonus per employee.”
“Its vital people aren’t just returning for the sake of it – they need to be doing decent work.
“So for businesses to get the bonus, the employee must be paid at least £520 on average, in each month from November to the end of January – the equivalent of the lower earnings limit in National Insurance.”
Businesses will get the bonus as a one-off payment, although the Chancellor hasn’t said when it will be paid or how employers go about applying for it.
The Sun has asked the Treasury for more information and we’ll update this article when we know more.
Mr Sunak said the government will spend £30billion as part of his plan to “recover and rebuild” the economy.
He warned that “hardship lies ahead” but insisted that no-one will be left “without hope”.
In just two months the economy contracted by 25 per cent, the Chancellor said – the same amount it grew in the previous eighteen years.
The Chancellor earlier this month said the UK is facing a “never-seen-before coronavirus recession” leaving permanent damage to the economy, which has already shrunk by 5.8 per cent in March
The retail, travel and hospitality industries have been particularly hard hit by coronavirus, with job losses and pay cuts being announced and some collapsing into administration.
For example, British Airways has announced that up to 12,000 jobs are to be scrapped while Ryanair is axing up to 3,250 roles.
On the high street, Debenhams has gone into administration, and Cath Kidston, Oasis and Warehouse have shut their doors for good.