1:53 pm, June 2, 2020
Close to nine million workers have been furloughed by employers because of the Covid-19 pandemic, new figures reveal.
As of Sunday, 8.7m jobs had been furloughed by more than a million businesses at a cost of £17.5bn – a rise from 8.4m a week earlier when £15bn had been claimed, figures from Her Majesty’s Revenue and Customs (HMRC) have revealed today.
Experts are now worried the scheme is masking massive unemployment, with the potential for sweeping job cuts across the board as it ends.
Large numbers of car dealers have big percentages of staff still on furlough and will be slow to get them back as they assess the demand for cars that there is out there.
Last week, the chancellor Rishi Sunak announced employers will have to pick up the tab for National Insurance payments from August.
Employees will be able to return to work part-time without losing any furlough pay from next month, the Chancellor also said.
Figures also revealed that 2.5m claims totalling £7.2bn have been made under the government scheme to support self-employed people.
‘We stood behind Britain’s businesses and workers as we came into this crisis, and we stand behind them as we come through the other side,’ the Chancellor said.
‘Now, as we begin to re-open our country and kick-start our economy, these schemes will adjust to ensure those who are able to work can do so, while remaining amongst the most generous in the world.’
A sizeable proportion of the 8.7m furloughed workers are those from the motor industry, many of whom are car sales people.
And despite car showrooms opening their doors across England yesterday (June 1), many car sales people have no idea when or if they will return to their pre-lockdown jobs.
Marshall Motor Group’s Daksh Gupta told Car Dealer Magazine that even with its showroom doors opening on June 1, only 50 per cent of staff who had been furloughed were back to work.
Gupta revealed he’s hoping the remaining 50 per cent can rejoin the business as soon as possible.
Outside of Marshall, at a national level, even those sales people who do return to work at showrooms may be going home with just their basic pay.
If sales people were paid correctly under the scheme, the maximum amount they will be paid is £2,500.
But as car dealerships were locked up during May because of Covid-19, many sales people would have earned no commission so will take home just the £2,500-basic wage.
Employers are aware of the problem, and firms like Marshall are working hard on rectifying the problem.
‘We are looking at what we can do to support these people,’ Daksh Gupta told Car Dealer Magazine yesterday. ‘Some sales executives will get some commission as some cars have been delivered in May, but we are aware we need to help others out.
‘We’ve always done the right thing by our employees and will work to do that here.’
Many dealer groups wrongly refused to pay the commission sales staff were due during the lockdown – despite the government advising them they should – so the chance of a helping hand in this scenario is very unlikely.
Lawgistics solicitor Nona Bowkis said: ‘This has come up a few times and there is no specific guidance, but we were recommending that the March commission was kept on hold to pay first month back and was not part of any furlough calculation.’
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