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News and Insight

Nurseries Prepare for End of Furlough

The Coronavirus Job Retention Scheme, which was instituted across the UK in March, will be coming to an end in October. The scheme was controversial for the Early Years sector, with anger arising from a late confirmation that those receiving public funds would be expected to make use of them paying furloughed staff. Even so, it has been a lifeline for many childcare businesses while they have only been able to take the children of key workers.

Although nurseries have been able to re-open since June, many are still at low capacity as demand for childcare recovers, meaning they have not brought all their staff back on board yet. Demand is increasing, as parents go back to work, reaching around 41% in early July, up from 35% at the start of June. However, occupation remains well below what would normally be expected. As a result, many nurseries still have some of their staff furloughed, or are waiting until later in the year to re-open.

Returning to normal operation over the next few months will create challenges for many nurseries. In particular, staffing requirements are likely to prove complicated. Nursery managers will need to ensure they bring staff back on board in line with demand and meeting ratio requirements, while still adhering to the requirements of employment law and regulations. Many will be undertaking detailed planning now, to ensure a smooth transition back to full capacity.

The government intends that most employers will return to normal by the autumn. To encourage this, furlough payments are going to be tapered from August. Employers will still have the option to continue furloughing their staff, but they will have to make up the additional pay themselves. From July however, furloughed workers may be brought back to work on a part-time basis. For nurseries who are opening for limited periods, but want to retain their highly-trained staff, this may be a suitable transitional arrangement.

Added to the strategic decisions nurseries need to make, will be a need to do things in the right way. This is all the more true given that the childcare sector has its own regulatory requirements, such as ensuring child:staff ratios continue to be properly met. For some, complex employment changes will be something that they have not experienced in the past. There is likely to be a lot of discussion on social media, and although much of it will be useful, basing final decisions on professional advice will be crucial.

The end of the furlough scheme will feel like a moment of truth for many businesses, but the nursery sector has always proved itself resilient. With proper planning and professional advice, it is sure to come through and see an end to the Covid-19 crisis.


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