A Massive Shock to the Education and Careers Support System on its Way

By Dr Deirdre Hughes

The introduction of new restrictions set out by the Prime Minster has reminded us all of the serious consequences of further lockdown measures on the British economy and the nation’s health and wellbeing. For those working in hospitality, leisure, theatres, travel and tourism, Covid-19 has ravaged jobs in these sectors.

Dr Deirdre Hughes OBE, Director, DMH Associates & Associate Fellow, University of Warwick IER
Dr Deirdre Hughes OBE, Director, DMH Associates & Associate Fellow, University of Warwick IER

There are serious concerns that unless there is some form of extension to or replacement of the furlough scheme, tens of thousands of job losses are inevitable. In this context, public pressure to create a fairer and more prosperous society is likely to increase.

This will bring about a paradigm shift in our thinking about schooling and its relevance to a changing world of work, home working and a sharp turn towards protecting jobs, livelihoods, health and wellbeing so often limited by structural inequalities in society.

Addressing widening educational inequalities

A new National Funding Formula for schools should ensure the funding system is more responsive to geographical areas of deprivation. However, a recent Institute for Fiscal Studies (IFS) report highlights “in the short run, the new formula will deliver funding increases of 3–4 percentage points less to schools in poorer areas than to those in more affluent areas up to 2021.” Government hopes a one-off payment of £80 per pupil aged 5-16 and a national tutoring programme targeted at more disadvantaged pupils will help address the widening of educational inequalities during lockdown. In this context, what messages will young people, teachers, parents/carers receive about the evolving education and careers landscape?

The launch of T levels

A recent FE News podcast with Minister Keegan highlighted the launch of T levels with discussion on the differences between this route and other pathways, including apprenticeships. I was struck by the reliance on a national campaign the ‘Next Level’ idea which shows students as they literally climb the floors of a building. Their rapid progression will dramatise how T Levels can help young people get further forward, faster – while also highlighting the qualification’s first three launch subjects of education and childcare, digital and construction. But the massive shock of Covid-19 and its effects on education and career opportunities requires more than this. The narrative of climbing upwards fast will need to shift more towards career adaptability, mental toughness, resilience and building a personal ‘safety net’ of support. In essence, having access to good career guidance (including highly skilled coaching techniques) addresses these basic fundamentals.

Career guidance in schools, colleges and local communities must be strengthened

The views and experiences of highly trained and qualified career development professionals in England have been overlooked by DfE, since May 2020 meetings with the professional body and the trade body has been promised but yet to materialise. Last year, a study commissioned by Careers England reported “less than a cup of coffee is being spent on careers advice for young people in our schools and colleges.”

To date, very little of the money the DfE are spending on careers actually goes to the schools and those working with and supporting young people in local communities, particularly those most in need. It is estimated that 1000 extra employment, training or education opportunities are needed each day to bring the number of young people not in education employment or training back to pre-crisis levels by October 2021.

Under the £2billion Kickstart Scheme, the Government will pay towards six months of wage costs of each 16 to 24-year-old hired by an employer. But this approach needs ‘feet on the ground’ (beyond DWP Work Coaches) to work directly with employers advocating on behalf of young people and gathering local labour market intelligence (LMI) to feedback into the education system. Adults too need to know where are the jobs and training opportunities?

The forthcoming FE White Paper should further shed light on the government’s thinking about evolving education and careers for young people and adults – aligned to a refresh of the Careers Strategy (2017). The shock to universities of a diminished international student population and uncertainty surrounding the 2020-2012 local student experience, brings a sharp focus on the availability of careers support, student placements, work experience and internships.

In our higher education landscape, those most privileged often have the best careers support made available to them delivered by highly trained professionals.

So, what’s the massive shock all about? 

In essence, we are talking about more individuals in our society being ‘unsettled’ and ‘uprooted’ from the normality of their so far lived experiences and expectations of education and work. At its core is the issue of identity, dignity, livelihood and sense of belonging and fulfilment.

In the 1970s and 1980s, Britain’s were forced to tighten their belts, contend with high inflation and increasing unemployment blighted their horizons. Fast forward fifty years, people’s expectations are higher today and in a modern society it should be an entitlement to have access to high quality careers support as part of a lifelong learning system that supports improved education, economic and social outcomes.

Interestingly, government responses back then saw the wisdom and realised the benefit of investing in careers services for young people to enable work programmes to operate effectively.[1]

Dr Deirdre Hughes OBE, Director, DMH Associates & Associate Fellow, University of Warwick IER

[1] Department of Employment – Careers Services Unemployment Strengthening Scheme.

Furlough Scheme Masks True Scale of UK Unemployment Rate
August 18, 2020
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The number of employees on UK payrolls in July 2020 was down an estimated 730,000 compared to March, according to the ONS labour market overview for August 2020.

Though the figures indicate employment is weakening due to the ongoing pandemic, the unemployment rate has remained largely unchanged due to an increase in economic inactivity, in which people are out of work but not looking for new jobs.

Joanne Frew, national head of employment at legal business DWF, said that this could be partly due to the number of people who have struggled with childcare throughout the pandemic and could therefore change as schools begin to reopen.

“The Coronavirus Job Retention Scheme (CJRS) will also inevitably be masking the true scale of unemployment,” she said.

“Figures are expected to surge in October when the scheme closes. Although the government has launched the Job Retention Bonus to help incentivise employers to bring employees back from furlough, longer-term strategies will need to be implemented to help tackle unemployment.”

Both the UK’s youngest workers and older generation pre-retirement age were found to be the most likely to be temporarily away from paid work during the pandemic.

This has created cause for concern due to the hiring challenges presented to each age group, particularly in a highly competitive job market.

“The sharp fall in employment highlights a dramatic deterioration for the employment prospects of young people, part-time workers and older workers in particular,” said Gerwyn Davies, senior labour market adviser at the CIPD.

“A real concern is that this is just the first wave of bad news for the jobs market. The fact that reduced hiring rather than increased firing of permanent staff is the main cause of the jobs slowdown to-date bodes ill for the coming months if more employers turn to redundancies as a last resort.”

To support those disproportionately affected by the post-pandemic job market, City & Guilds Group has advised government to redirect its existing funding for further education.

City & Guilds Group CEO Kirstie Donnelly said that the funds should be allocated to develop skills that match jobs which are currently available and in demand.

“As the labour market shrinks, it’s crucial that we take immediate action to ensure that people, especially those most in need, have the opportunity to get the training, skills and experience they need to access employment, and that young people leaving education understand what is a viable route into a job,” she said.

The report also found that pay decreased in the three months to June 2020 to rates below price inflation, although in sectors like hospitality and construction where workers are returning from furlough, pay growth improved slightly for June 2020.

The claimant count increased by 116.8% from March to July, reaching 2.7 million people.

Smaller businesses drove vacancies in this same period up to 370,000 – a 10% increase on April to June.

With mass redundancies, job insecurity, and a recession ahead, the CIPD has called on government to undertake further intervention.

“The combination of large-scale job losses, job insecurity and falling real incomes means that the UK economy needs all the help it can get,” added Davies.

“The government might therefore wish to consider keeping an open mind to protecting some industries through a revised Job Retention Scheme beyond the end of October and through the winter.”

Redundancy: Seven Questions Employers Should Ask Themselves

By Richard Thomas Employment Law Partner Capital Law 

What are your legal requirements as an employer when making redundancies?

Serious sad woman in sweater carrying cardboard box full of stuff and leaving office after dismissal

In the volatile market situation we find ourselves in at present, redundancies may be unavoidable for some organisations, but there are certain legal obligations that need to be fulfilled when employers take this route. Here, we’ll look at seven key aspects employers should consider before embarking on this.

1. Is redundancy a ‘legally straightforward’ way of dismissing employees?

Not really. There are plenty of variables that can easily complicate and delay a redundancy process. These include an employee’s length of service, the number of employees at risk, the involvement of a trade union, the number of sites affected, and the timescales involved. Add to these the logistics of trying to arrange the consultation process mid-pandemic, and it can quickly become difficult.

2. What is required before I can start a redundancy process?

The key condition is that a ‘genuine redundancy’ situation must be proven. In the current context, it would be relatively easy for many businesses to show that they find themselves in such a situation.

There is no one-size-fits-all test, but the situation must fall within one or more of the following categories: a business closure (the business shuts altogether); a workplace closure (the business is partly shut/ is relocated); or a reduction of workforce (the business no longer has sufficient work for some or all its staff).

As well as the impact of Covid-19, other scenarios could include a reduction in demand and/or customers, automating systems and streamlining staff.

3. How should I choose the employees to be made redundant?

At the outset, the business should ‘identify the ‘pool’ – i.e. the group of employees from which it will choose those who are to be made redundant.

When choosing those who are to be made redundant, fair and objective selection criteria should be used. Common examples can include length of service; disciplinary history; performance, skills, qualifications, experience and appraisals.

Selection criteria should not be based on unlawful/unfair grounds, such as an employee’s age, sex or race (discriminatory factors), absence for family, maternity, or disability related reasons, a role as a trade union or employee representative, or whistleblowing.

There is usually no requirement to consider any selection criteria if all employees are being made redundant, or if there is a pool of one.

4. Do I need to consider any alternatives to compulsory redundancy?

One option to consider at the outset is to offer voluntary redundancy. This might reduce the number of employees in the process, or prevent it happening altogether.

Before and during any meaningful process, you should consider other ways in which compulsory redundancies could be avoided, or at least reduced. This might include:

  • Identifying and offering alternative employment.
  • Recruitment freezes.
  • Reviewing and ending contractor arrangements.
  • Reducing overtime.
  • Allowing sabbaticals, flexible or reduced working, career breaks etc.
  • Cutting bonuses and other benefit schemes.
  • Early retirement.

If an employee has two years’ service or more, employers will be under a legal obligation to consider alternatives like the above, or otherwise be faced with the risk of a claim for unfair dismissal.

Employees and their representatives may also have their own suggestions on how to avoid a redundancy situation, which should come to light during the consultation process.

5. Do I need to think about collective consultation?

Quite possibly. In addition to individual consultation, if the number of proposed redundancies will be 20 or more within a period of 90 days at a single establishment, this will trigger collective consultation requirements. These include:

  • Notifying the Redundancy Payments Service before any consultation starts.
  • Consulting with trade union/elected employee representatives, and providing them with certain prescribed information.
  • An obligatory freeze on any redundancies taking effect for a 30-day period for 20 to 99 redundancies, or 45 days for 100 or more redundancies in 90 days.

Failing to follow these rules can prove costly. An employment tribunal can award up to 90 days’ uncapped pay per affected employee where an employer has breached its obligations.

If fewer than 20 redundancies are proposed, there are no strict collective consultation rules to follow, but it is always best practice to fully consult employees (and their representatives if applicable) throughout the process.

6. How do I consult during the pandemic?

If businesses remain open and staffed, and it is possible to do so, the traditional way of consulting face-to-face and electing representatives (within social distancing guidelines) may still be a viable option.

For many businesses, however, the alternative virtual route may be best. Employers can, just as efficiently, inform and consult employees through Microsoft Teams, Zoom, Skype etc. Provided that the legal requirements are met, conducting the process remotely should not prove to be an obstacle for employers.

Similarly, employers who have been required to arrange elections of employee representatives (which should be done by secret ballot) have found online tools such as Doopoll and SurveyMonkey useful for gathering nominations, while still protecting anonymity.

7. What will I need to pay redundant employees?

If an employee has two years’ continuous service or more, they will normally be entitled to a statutory redundancy payment (SRP) – calculated on the basis of their age, pay and length of service, and paid tax-free. There is also a weekly cap (currently £538) and a total cap (currently £16,140) when it comes to calculating SRP.

Some businesses may also offer enhanced redundancy packages, over and above SRP, which may also be paid tax-free (but not guaranteed) up to £30,000.

For those who have less than two years’ service, there is no automatic legal right to SRP. The employee’s contract and all redundancy-related policy documents should be checked, however, to make sure that no such right exists.

In addition, redundant employees (regardless of their length of service) will be entitled to their notice period and pay at the end of the procedure. Depending on the employee’s contract, you may be able to make a payment in lieu of their notice period (otherwise known as PILON).

ESFA Reveals Calculations for the Furloughed Apprentice Wage Top-up

REPORT FROM FEWEEK.

The Education and Skills Funding Agency has finally confirmed that the national minimum wage requirement for a furloughed apprentice applies to just the “training hours during the furlough period”.

In an email from a senior manager in the funding policy team, seen by FE Week, an explanation with two worked examples is provided.

A furloughed employee can take part in volunteer work or training, as long as it does not provide services to or generate revenue for, or on behalf of the employer.  Training in this context includes apprenticeship off-the-job training. Where their provider can continue to deliver training remotely, a furloughed apprentice can therefore continue their apprenticeship whilst furloughed.

Where training is undertaken by furloughed employees, at the request of the employer, they are entitled to be paid at least their appropriate national minimum wage for this time. In most cases, the furlough payment of 80% of an employee’s regular wage, up to the value of £2,500, will provide sufficient monies to cover these training hours. However, where the overall time spent training, during the furlough period, attracts a minimum wage entitlement in excess of the furlough payment, employers will need to pay the additional wages. This is because time spent training is treated as working time for the purposes of the minimum wage calculations and therefore must be paid at the appropriate rate, taking into account the increase in minimum wage rates from 1 April 2020.

Employers should consider the hours that an employee is expected to train during the period of the furlough (which must be a three-week minimum). Employers will need to ensure that the furlough payment provides sufficient monies to cover these training hours. Where the entire furlough payment equates to less than the appropriate minimum wage entitlement for the training hours during the furlough period, the employer will need to pay the additional wages to ensure at least the appropriate minimum wage is paid for the time spent training.

Our worked examples show how to calculate whether the furlough payment equates to less than the appropriate minimum wage entitlement for time spent training.

Example 1:

18 year old first year apprentice is on a 37 hours per week contract and has been furloughed.  They are continuing to training for 1 day per week (7.5 hours per week).

In terms of the National Minimum Wage Regulations they are entitled to £4.15 for every hour they train. (Note that the NMW legislation does not apply to time not in work or training).

Over the 3 week furlough period (the pay reference period) this amounts to a NMW entitlement of £93.38 (£4.15 x 7.5 hours x 3 weeks).

The 80% furlough payment that they have received from their employer is £368.  This furlough payment provides sufficient money to cover these training hours.

Example 2:

22 year old second year apprentice is on a 37 hours per week contract and has been furloughed.  They have agreed, with their employer and provider, to train for 4 days per week (7.5 hours per day) (to cover as much off-the-job training as possible during this period).

In terms of the National Minimum Wage Regulations they are entitled to £8.20 for every hour they train.  (Note that the NMW legislation does not apply to time not in work or training).

Over the 3 week furlough period (the pay reference period) this amounts to a NMW entitlement of £738 (£8.20 x 7.5 hours x 4 days x 3 weeks).

The 80% furlough payment that they have received from their employer is £728.16.  This furlough payment does not provide sufficient money to cover these training hours and the employer would need to top up the difference (£9.84).

*Note is both cases above the apprentice, prior to furlough, was paid at/close to the National Minimum Wage. 

Furloughed Employees in the Training Sector Have Their Say
May 4, 2020
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By GPRS Recruitment.

GPRS Recruitment

We’ve all been unable to escape the word ‘furlough’ over the past few weeks – a term many of us were not even familiar with before this crisis. Simply put, the government’s furlough scheme guarantees employees who have stopped working during the coronavirus pandemic 80% of their wage (with exceptions).

Fortunately, only 30% of candidates who responded to our survey said that they have been furloughed.

The Financial Times reported at the start of April that up to half of companies in the UK were furloughing their staff (https://www.ft.com/content/8e2…85-a9bf-78deeb94bc80), so the training sector appears to be more active than other industries, with most staff still working, albeit remotely.

53% of staff in the sector who have been furloughed agreed with the decision to furlough them, acknowledging that it would be impossible for them to perform their role remotely. In terms of training staff, there are of course some fields in which trainers are unable to deliver remotely, namely the more ‘hands on’ qualifications such as hairdressing and construction.

A further 14% of furloughed candidates, when asked if they felt it was necessary for them to be furloughed, selected ‘other’ and offered comments such as ‘learners [being] unavailable’ due to their own work being disrupted, ‘client demand lowered and there were many cancellations’, and delivering remotely being ‘impossible with a young child’. In addition to simply whether a qualification can be delivered remotely or not, there are a wealth of other factors that have been considered when the decision has been made to furlough or not.

Indeed, only one third of those that told us they have been furloughed described themselves as trainers, with the majority of furloughed employees identifying themselves as management or admin staff. With apprenticeships still continuing where possible, and apprentices still being able to continue with their qualification if they have been furloughed themselves, for most training staff there is still work available, and happily, for many training providers furlough is a last resort.

*The survey was conducted between 6th and 10th April 2020. The survey had 1,598 responses.*

HMRC Publish Furlough and Training Guidance for Apprentices

The government has finally confirmed that apprentices can continue with funded training when employers use the job retention scheme, subject to being paid the apprenticeship minimum wage “for all the time they spend training”.

HMRC guidance published on 4th April (click here),  says: “Apprentices can be furloughed in the same way as other employees and they can continue to train whilst furloughed.

“However, you must pay your Apprentices at least the Apprenticeship Minimum Wage, National Living Wage or National Minimum Wage (AMW/NLW/NMW) as appropriate for all the time they spend training. This means you must cover any shortfall between the amount you can claim for their wages through this scheme and their appropriate minimum wage.

“Guidance is available for changes in apprenticeship learning arrangements because of COVID-19.” Click here

Confused about the Coronavirus Job Retention Scheme or what being on Furlough means?
April 3, 2020
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By Kate Palmer, Associate Director of Advisory at Peninsula

@Kate1Palmer @peninsula_uk shares some advice on the #Coronavirus Job Retention Scheme and what being on #Furlough means.

Recently, Chancellor Rishi Sunak announced a package of support to help employers survive the coronavirus lockdown and continue to pay their staff. The Chancellor said any employer in the UK would be eligible for the coronavirus job retention scheme and that Government grants will cover 80% of the salary of furloughed workers up to a total of £2,500 a month.

But what does it mean to be furloughed? Kate Palmer, Associate Director of Advisory at global employment law consultancy, Peninsula, explains below.

What is the Coronavirus Job Retention Scheme?

The Government has announced its plans for financial assistance to help employers retain employees during the coronavirus outbreak, although offering no work, and avoid lay-offs. It is called the Job Retention Scheme. Under the scheme, employers place their employees on ‘furlough’ This isn’t a term we use in UK employment law, and it seems to originate in the USA. It essentially means putting employees on a temporary leave of absence where they do no work, but they are retained on company books to be brought back in when needed.

The guidance sets out that organisations will need to designate which of their workforce will be furloughed employees and then submit that information to HMRC, along with each employee’s earnings.

Information will be able to be submitted through an online portal. Employers who furlough staff will be able to obtain a grant from the Government to cover 80% of furloughed employees’ wages, to a maximum of £2,500 per employee per month. Chancellor Rishi Sunak has stated he hopes the first grants will be paid by the end of April 2020, and they will be backdated to 1 March 2020. The scheme is initially intended to run for three months but may be extended.

Who is covered by the Coronavirus Job Retention Scheme?

All businesses can access the scheme, whether the virus has severely impacted the company or not. This is true regardless of the size of the business and the sector it operates within. Workers must have been on the organisation’s PAYE from at least 28 February 2020 to benefit from the grant. However, all workers in this position are eligible, including those on zero-hour or temporary contracts.  Workers who were made redundant prior after 28 February can be re-employed and placed on furlough instead. The grant will still cover their wages for this period.

What is the process for furloughing?

The guidance states that the ability to furlough an employee depends on their contract. It is not likely that employee contracts will include a specific right to use furlough. However, contracts may contain a right to lay off employees on no pay already so are expected to make the discussions around furlough a little smoother.

In any case, even when there is a right to lay off, it is still advisable to gain the employee’s agreement to furlough to avoid any confusion in the future. When faced with potential redundancies, a period of leave with 80% pay may seem an attractive option to employees. If an employer has already taken the step to utilise lay off, they can get in touch with those employees and agree to change their current status from lay off to furlough. They still wouldn’t be provided with any work, but their pay arrangements would be changed from nothing, or the payment of statutory guarantee pay, to 80% wages.

Workers should not undertake any work for the organisation while on furlough that amounts to making money for it or providing services to it. If workers are asked to undertake training while on furlough, they should be paid in line with the national minimum wage even if this is above the 80%.

Can I force an employee to be furloughed?

Employers need to designate employees as furloughed, which means it is their choice. However, if businesses are not placing everyone on furlough, they should consider carefully who it should be and whose skills will continue to be in demand through this challenging period. While it may be assumed that the best thing to do is furlough those employees labelled as high risk by the Government, forcing them on to furlough without their input, and therefore forcing them on to 80% wages, may result in discrimination claims from those who allege they were made to do it because of their age, disability or pregnancy.

Where employees need to be selected for furlough, it may be best to ask for volunteers across the workforce. If any high-risk employees, who had previously been risk assessed as fine to still be in work, put themselves forward, it may well be appropriate to choose them first.  There does not appear to be a maximum or minimum number of employees who can be furloughed

Kate Palmer, Associate Director of Advisory at Peninsula