The Leading News & Information Service For The Facilities, Workplace & Built Environment Community

Compass Group Joins List of Firms Not Claiming Furlough Bonus

Compass Groups Joins List of Firms Not Claiming Furlough Bonus
22 July 2020
 

Compass Group, the UK’s largest food and support services company, has confirmed that it will not be taking up Job Retention Bonuses for any of its employees.

21,000 Compass staff are currently furloughed on the Coronavirus Job Retention Scheme, meaning the company could have benefitted from of £20 million from the new bonus.

Other businesses that have publicly confirmed that they will not claim the furlough bonus include: Rightmove, Primark, John Lewis, Laing O’Rourke and Kier.

 

“Businesses which are in dire straits as a result of COVID-19 have, by and large, already taken steps to reduce headcount and streamline their services.  A bonus that they won’t see until January 2021 is unlikely to have much, if any, impact on those decisions.”

– Prettys Solicitors Employment Team  

 

 

Good Corporate Citizenship? 

 

Compass Group has not expanded on the reasoning for its decision not to claim. Sheilah Cummins and Matthew Cole, from Prettys Solicitors’ Employment Team, predicts that the reasons behind such business decisions are based  upon “good corporate citizenship”:

“Some businesses may wish to keep their options open with regard to future redundancies, others may be worried about the additional attention taking the bonus may attract from HMRC.   We think the reason is, ultimately, more simple than this.  The reality is that the Job Retention Bonus being offered will make very little difference to a Company’s balance sheet. 

Businesses which are in dire straits as a result of COVID-19 have, by and large, already taken steps to reduce headcount and streamline their services.  A bonus that they won’t see until January 2021 is unlikely to have much, if any, impact on those decisions.  

“Other, larger and more stable, business such as the Primarks and John Lewis’ of this world, as well as other high-profile, high street chains know that they are expected to weather the COVID storm better than their independent, and smaller, counterparts. 

“To this end, they may see their rejection of the Job Retention bonus as their civic duty and an example to others of good corporate citizenship.”

 

Is it Enough to Protect Jobs?

 

The scheme is, of course, not without conditions. Employers can bring back someone who was furloughed and get paid a £1,000 bonus per employee. They will need to be continuously employed through to January 2021 and the employee must be paid at least £520 per month on average.

Not everyone agrees that the scheme will be enough to help stimulate employees’ return to work, with the Chartered Institute of Personnel and Development (CIPD) stating they were not convinced the bonus “will provide sufficient incentive to encourage employers to bring workers back from furlough beyond those they would be planning to bring anyway.”

The CIPD believes that a simpler way of protecting jobs would be to extend the Job Retention Scheme for key sectors such as hospitality and leisure beyond October.

Picture: A photograph showing someone placing some coins into a Piggy Bank

Article written by Ella Tansley | Published 22 July 2020

Share



Related Articles

The Future of Workplace Restaurants

Morag Freathy, Managing Director of Compass Business & Industry, looks at what workplace catering might look like in the offices of the future. Freathy...

 Read Full Article
FM Companies Show Commitment to Food Waste Action Week

Companies such as Sodexo, ISS and Compass Group have all joined the campaign to halve food waste by 2030. Around a third of the food we produce worldwide is lost or...

 Read Full Article
The Budget 2021 – What do FMs Need to Know?

As Chancellor Rishi Sunak reveals this year’s Budget, what are the main points that facilities managers should be aware of? The annual Budget is set by the...

 Read Full Article
CBRE Joins Real Estate Companies in Returning Furlough Payments

CBRE is the latest commercial real estate firm to announce that it will return all furlough payments claimed during COVID-19. The company will also allegedly top-up...

 Read Full Article
Trades Union Congress Urges Employers to Furlough Parents Affected by School Closures

The TUC is calling on employers to offer furlough to all parents affected by the closure of schools, as all secondary schools will remain closed this week. The union...

 Read Full Article
Another Furlough Extension - What Happens Now?

The Coronavirus Job Retention Scheme has been officially extended until 31 March 2021, but what else do employers need to know? Alan Price, CEO of BrightHR, explains...

 Read Full Article
Government Announces new Job Support Scheme

In a speech in the Commons today, Chancellor Rishi Sunak has announced a new Job Support Scheme to help protect employment once the current furlough scheme ends. The...

 Read Full Article
HMRC Accepts £215m in Furlough Returns

£215m of furlough funds have been returned to the government in circumstances where they were mistakenly claimed, or entirely unnecessary. HMRC have recorded...

 Read Full Article
Furlough Fraud Bill up to £3.5bn, Says Tax Authorities

The government has said that up to £3.5bn may have been fraudulently or mistakenly claimed under the Coronavirus Job Retention Scheme. Speaking to the Commons...

 Read Full Article
Furlough Support for Employers Continues To Decrease 

From 1 September 2020, businesses using the Coronavirus Job Retention Scheme will have to pay ten per cent of their furloughed employees’ wages. The...

 Read Full Article