Reduced furlough and lack of tronc could see wages fall below 60%

28 May 2020 by
Reduced furlough and lack of tronc could see wages fall below 60%

Concerns have been raised that furloughed hospitality workers could see their pay fall below 60% if the exclusion of tronc is exacerbated by the chancellor tapering off support.

Analysis by software provider Fourth has shown that, on average, tronc payments make up more than a quarter of hospitality workers' basic pay, meaning many will already be receiving 60% of their normal take-home amount, rather than the 80% intended by the Coronavirus Job Retention Scheme (CJRS).

With the government expected to announce the scaling back of its contribution towards the pay of furloughed workers, concerns have been expressed that this could fall further.

James England, senior vice-president of Fourth, which analysed data in relation to 120,000 hospitality workers, said: "In addition to graphically illustrating what an important component tronc is for many hospitality workers' pay, these findings also demonstrate why a tapering off of support could really hurt the finances of hospitality workers, as many of those furloughed aren't receiving 80% but more like 60% of their normal earnings.

"While this is an extremely challenging time, optimism is returning to the industry; many hospitality businesses are developing their reopening plans in line with government guidelines and timings and retention of their key staff will be crucial to successfully reopening. There are concerns that further reductions in payments to furloughed staff could mean that a career in hospitality is not financially viable in the current environment and could result in significant numbers of people being forced to look at other industries for employment."

The industry has been lobbying the government to include tronc payments in its furlough scheme and 39 MPs from across political parties have agreed to lobby chancellor Rishi Sunak to adapt the CJRS.

The campaign has been spearheaded by WMT Troncmaster Services managing director Peter Davies, who said: "It's really encouraging to see so many MPs from different parties coming together to support hospitality workers. Those workers are not seeking special treatment over furlough pay but equal treatment with staff in other sectors and the self employed."

Kate Nicholls, chief executive of UKHospitality, added: "The Job Retention Scheme has been a vital lifeline for employees and employers – providing an income while allowing businesses to retain their valued workforce. It is time for an approach that is #Fair4Hospitality employees – with access to their full earnings under furlough and extension of full furlough until their employer is back to full service."

Picture: Shutterstock

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