The Job Retention Scheme has been beneficial for many UK businesses during the ongoing COVID-19 pandemic.
The scheme has provided short-term financial support for businesses during the UK lockdown, allowing companies to pay their workers 80% of their monthly wages. JRS has helped employers keep their employees on payroll until the business can start to return employees back to work.
The Job Retention Scheme comes to an end in October 2020.
Prepare now for an end to the scheme, with workers returning to full employment and the imminent impact on your payroll costs.
Planning and reviewing your financial situation will be critical. And that means taking the time now to prepare and get ready for the scheme closure.
Here are some key areas to focus on:
Review your sales and revenue pipelines – you need to know (with some clarity) what money will be coming into the business from October onwards. Look at your sales pipeline, run revenue projections and give yourself an informed overview of how much income will be generated and how this will affect your financial position.
Assess your cashflow and working capital positions – getting in control of your cashflow will be critical to coping with this drop in financial support.
Review your workforce requirements – production levels and customer sales are likely to be down in the post-lockdown market. Look at what people you will need to run your current services or produce your current level of products – do you need everyone on the payroll, or only a percentage? The decisions you make on staffing will be crucial, so this will need plenty of thought and consideration.
Cost-saving measures – if there’s likely to be revenue and cashflow gaps come October, getting serious about cost-cutting will be necessary. Look at the options for freeing up cash, cutting overheads and expenses, or accessing additional finance.
Making people redundant is obviously a last resort – if none of the cost-cutting, funding and staffing options are possible, then you will be faced with some stark decisions regarding redundancies and losing staff.
The sooner you start planning and making changes, prior to October, the better prepared you’ll be.