The government’s Coronavirus Job Retention Scheme (aka the furlough scheme) is ending on 30 September 2021. This brings to a close almost 18 months of unprecedented support for UK businesses.
End of an era
For many employees, it’s the start of working full-time again, perhaps in a hybrid working set-up splitting time at the workplace and time working from home. However, the end of furlough is also the point where UK companies are going to be taking a long hard look at their future staffing needs.
Many businesses may have already done this, triggered by the need for a salary contribution from employers back at the start of July. Others would have hung on until now so they can take a more accurate look at their growth projections and assess if they need the same staffing levels as they required pre-pandemic.
From furlough to redundancy
Despite all the reports of rising job vacancies, there will inevitably be some furloughed employees who will be made redundant once the Coronavirus Job Retention Scheme finally ends. If you are one of them, redundancy might come as quite a surprise after months of expecting to return to work at some point. What’s more, you may not have a choice about it.
This could be because the business has been hoping for a recovery that may or may not materialise. As financial analyst Danni Hewson said in an article at YourMoney.com:
“For the millions of people still on furlough the next few months bring agonising uncertainty. Will they still have a job once the scheme comes to an end in September or have their jobs become zombie positions and ones their employer is unable to sustain once they have to start chipping in?”
Redundancy is not a judgement
If you’re on the receiving end, it’s important to remember that redundancy is a business decision. It is not personal. As an article in The Telegraph says:
“An employee is made redundant because their employer is closing or because the company no longer needs that role to operate. It differs from being fired because it does not relate to the quality of your work.”
Your rights retained
If you have been on furlough, that doesn’t affect your legal rights regarding redundancy. As Keystone Lawyers’ website explains in their guidance for employers:
“Furloughed workers have the same legal rights as any other employee … Any redundancy must be genuine and fair, with due process followed. This applies to both furloughed staff and working staff. Employers can (and should) consult with employees on furlough.”
Show me the money
On the other hand, you might be waiting to see what your company offers in the way of voluntary redundancy You may have an eye to retiring after months of enjoying freedom from work backed with a salary income.
And that is the issue for so many who may look at voluntary redundancy / early retirement, the mental gear shift from a salary to an income in retirement. It can seem a very big change from a regular wage coming in every month to an income from investments or a pension coming in every month. In fact, for many, it is just a change of income source, a shift from one source of money to another.
The real gear change is in your lifestyle, giving you the freedom to do whatever you wish with your time. That in itself can be a huge mental shift, from a regular routine to an open-ended lifestyle of seven-day weekends. This is the key challenge, in my view, not how you fund your retirement, but how you live it.
The redundancy cliff-edge
I was talking to an exec recently for whom redundancy was like a massive full stop in his life, a cliff edge that he felt he’d had to jump off straight into the murky waters of full-time retirement.
Redundancy doesn’t need to be like that. The key is to transition between full-time work and full-time retirement in the way that best suits you. That might mean finding part-time work for the social side and some income, or exploring new flexible work options that take you in new directions.
Think of the route from redundancy to retirement as a gentle paraglide towards working less and living more. Yes, paragliding still involves running headlong off a cliff or a hill, but at least you’re ready for it, know where you’re heading, and the view ahead is amazing! Enjoy the ride.
“The secret of change is to focus all of your energy not on fighting the old, but on building the new!”