The Job Support Scheme announced by Chancellor Rishi Sunak is woefully inadequate. It puts workers in danger by forcing us to travel to work during a winter upsurge in the pandemic. It amounts to a substantial pay cut, with no increase in Universal Credit or rent holidays on the horizon. The scheme begs bosses to go against their ruthless capitalist logic and pay more wages than they receive in work. Many of us will struggle to live, and those not in “viable” work will face mass-redundancies.
Note: The Job Support Scheme has been changed so the details in this piece are no longer up-to-date (24/10/2020).
What is it?
The Job Support Scheme (JSS) is a wage subsidy for “viable” jobs, which will replace the Job Retention Scheme (JRS) that ends on October 31st. It will subsidise bosses to pay staff for working at least one-third of their usual hours, with a cap of £697.93 per month.
In order to prove that jobs are “viable,” for the first three months of the scheme workers will be required to work at least one-third of their normal hours.
Employers will pay workers for the hours they are required to work at their normal contracted wage. If your boss reduces your hours to one-third, the Government will pay one-third of the wages for hours not worked, and your boss will pay another third. This means you will have a pay cut; for every hour you are not required to work, you will receive 33% less than your normal hourly rate.
Workers can “cycle on and off the scheme,” with each short-term arrangement being at least seven days. The JSS will be calculated according to your “usual pay” or “usual hours,” not your basic salary or hours. This means that if you used to work a lot of overtime, for example, this should be taken into account.
All ‘small’ and ‘medium’ businesses will be automatically eligible for the scheme, but larger businesses will have to prove their turnover has been negatively impacted by coronavirus.
Workers cannot be made redundant or put on notice during the period when the boss is claiming the grant.
The Government will pay self-employed workers 20% of their normal trading profits. Though details are yet to be published, it looks like self-employed workers and those on bogus self-employment contracts will receive very little support and will continue to suffer.
Forced to work in a winter pandemic
The JSS is meant to ensure that businesses keep staff employed for fewer hours instead of making them redundant. But for thousands of workers it will do no such thing. The policy is only concerned with “viable” jobs. In this context, “viable” jobs are those where people are forced to work through the pandemic. We are very likely starting a second-wave of high infection rates, bringing with it a substantial increase in the number of deaths.
We do not know what the situation will be in November. However, because healthcare services are pushed to their maximum capacities every winter, Covid-19’s impact on public health could be worse than we have yet seen. Workers will be forced back to work in dangerous circumstances – on public transport that is naturally busier in winter months – because bosses might be able to scrape a profit out of us. Not only would this be unsafe for workers, it would aid the spread of the virus.
Second-wave, second full lockdown?
The recent upsurge in coronavirus cases was caused by the Government forcing people back to work and re-opening schools prematurely. In the bewildering so-called “local lockdowns” that some parts of the UK are resorting to, many unessential workplaces remain open, such as those in the hospitality and tourism sectors. But what are the plans for a second actual lockdown, where only essential workplaces remain open? This scheme has nothing to say about that eventuality; countless jobs will be “unviable,” bosses will initiate mass-redundancies, and a huge number of us will be left with only the crumbs of Universal Credit in the depths of winter.
Wage Cut with no further assistance
For the hours that we are not required to work, we will face a substantial pay cut. Beth, an example of a worker in the JSS factsheet, will miss out on £70 per week! However, the Trades Union Congress has welcomed the policy, with Frances O’Grady stating that Sunak has “done the right thing.” The TUC is already looking ahead to 2021; “We can use the winter months to plan an economic spring.”
This begs the question: how are we even going to make it to the spring? For months workers have had to get by on 80% of their normal income. For many it will drop to 77%. The poorest workers will find it extremely difficult to continue into the winter months with this kind of salary reduction. With no increase in Universal Credit, no rent holidays, and the increasing cost of heating bills in the winter, where are these workers going to find the money to survive?
Sunak claims that “the primary goal of our economic policy remains unchanged – to support people’s jobs.” This is a meaningless phrase unless the wages themselves are high enough to pay the bills.
What can we expect from bosses?
The above criticisms rely on workers actually going back to work. But this is far from a given.
It is very likely that wealthy employers will be arguing that they cannot afford to retain staff, purely as a bluff to force Sunak to bail them out. However, as many fellow workers in the Arts, Music, and Theatre sectors have found, many employers will genuinely be unable bring back staff even on a part-time basis. This problem is made worse with regards to how to payment is calculated and who pays what. Consider a full-time worker who is brought back to for work one-third of their normal hours. For the hours not worked they will receive 77% of their usual wage, with the Government covering 22% and the employer covering 55%. Will bosses pay this amount of money for fewer hours worked? It seems very unlikely! Bosses will only risk this kind of expense for their most valued, high-skilled workers. Young workers, ‘low-skilled’ workers, and those on precarious contracts in non-unionised workplaces are at greater risk.
The scheme is an incentive for bosses to make full-time workers redundant and re-hire them on cheaper part-time and precarious contracts. Furthermore, the “cycle on and off” system could be abused by unscrupulous bosses. We can expect unprofessional employers to bully and pressure workers to “cycle off” the scheme in order to make them redundant, and re-hire them on a worse contract. Workers will need to get organised to oppose these redundancies.
Austerity ideology
The Job Retention Scheme (furlough) was itself inadequate, particularly for those of us on bogus self-employment contracts, zero-hours workers, and unemployed workers, but it did have some value. The Government took advantage of historically low interest rates to keep millions of people with some kind of income. This helped workers to survive, while not forcing us to go to work and put ourselves and others at risk. Any argument that this cannot be continued over the winter is ideological nonsense.
The UK Government’s scheme does not look good against such contemporaries as Spain, France, or Germany. It is difficult to directly compare the schemes, but the German government paying 60% of a worker’s unworked hours is a stark difference to the UK’s 22%. Furthermore, the UK scheme does not make pension contributions, whereas the German scheme does. We should view the scheme for what it is, a political decision rooted in austerity ideology, that ‘balancing the books’ – whatever that means for a capitalist nation-state – is more important than keeping people alive. The Government should be doing so much more.
Sunak calls this a “winter protection program.” It is anything but.
Keep your hands upon your wages, and your eyes upon the scales.
Though the labour movement is on the defensive at the moment, we should not lose sight of our overall aims. The public health crisis is not simply the problem of a particular virus, but of capitalism itself. The value of work in capitalism comes from whether or not it contributes to a growth in shareholder profits. This is what deems work “viable” or not in Sunak’s JSS. Nevertheless, the Conservative Government is gradually figuring out how it will adapt to the presence of the virus. The labour movement should be aware of the long-term manoeuvres.
The IWW needs to grow its Industrial Unions to present an alternative way forward. Building the kind of power and leverage we need will only happen when we organise across our workplaces, industries, and supply chains.
“By organising industrially we are forming the structure of the new society within the shell of the old.” Preamble, 1905.
Join the IWW. Contact your branch and the Organising Department to start building power at work!