The TUC is calling on the government to establish a permanent short-time working scheme as “a post pandemic legacy” to help protect working people through periods of future economic change.
The TUC says the furlough scheme, while far from perfect, is one of the major successes of government policy during the pandemic, protecting millions of jobs and livelihoods.
On the back of the success of the furlough scheme, the union body is urging government to build on furlough – “not throw away its good work” – with a permanent short-time working scheme to make the labour market more resilient in times of change and crisis.
The union body adds that because of the UK transition to net zero and the increased uptake of new technology, this is “hugely relevant”.
In a new report, Beyond furlough: why the UK needs a permanent short-time work scheme, the TUC says the case for a short-time working scheme is clear, citing significant benefits for workers, firms and government.
The union body says for workers, a short-time working scheme would reduce the risk of workers losing their jobs in times of crisis. protect workers’ incomes – particularly as short-time working schemes are usually more generous than unemployment benefits and prevent widening inequalities – protecting women, disabled workers and BME workers who tend to lose their jobs first in a recession due to structural discrimination
The TUC predicts that the UK economy is likely to face significant risks in the future – be it from climate change and the transition to net zero, new technologies such as AI, new variants or another pandemic. All could cause unpredictable and widespread disruption in the labour market – causing big spikes in unemployment and business failure.
The TUC cites failed attempts to manage industrial change in the past, which “left communities abandoned” and played a major role in the widespread regional inequality we see today.
The union body says that if the government is serious about levelling up, it will put in place a permanent short-time working scheme to prevent inequalities spiralling – adding that a short-time working scheme could play a vital role in achieving a ‘just transition’ to net zero.
The TUC says the scheme should be governed by a tripartite panel bringing together unions, business and government, which should be tasked with designing the criteria for the new scheme.
TUC General Secretary Frances O’Grady said:
“Everyone deserves dignity and security at work. The pandemic shows how an unexpected economic shock can wreak havoc on jobs and livelihoods with little warning.
“In a changing and unpredictable world – as we battle climate change and new technologies emerge – a permanent short-time working scheme would help make our labour market more resilient and protect jobs and livelihoods.
“Too often in the past, periods of economic and industrial change have been badly mismanaged – increasing inequalities and leaving working people and whole communities abandoned.
“Setting up a ‘daughter of furlough’ to provide certainty to workers and firms through future industrial change would be a fitting pandemic legacy.
“Furlough has been a lifeline for millions of working people during the pandemic. Now is the time for the government to build on the success of furlough with a short-time working scheme – not throw away its good work.”
The call for a permanent short-time working scheme comes exactly six weeks before the furlough scheme is set to end – the date at which employers are legally obliged to start consulting on planned redundancies with their staff.
The TUC is warning the abrupt end to the furlough scheme will cause unnecessary job losses and may harm the country’s economic recovery.
Recently, aviation unions have also been raising concerns about the sudden end to the furlough scheme and the loss of jobs in the sector.
“The jobs market is still fragile, with more than a million people still on furlough.
“An abrupt and premature end to the furlough scheme will needlessly cost jobs and harm our economic recovery.
“Instead of pulling the rug out from under the feet of businesses and workers, the chancellor must extend the furlough scheme for as long as is needed to protect jobs and livelihoods.”
