Furloughed by Coronavirus? 5 things to do right away

As you well know, we are living an unprecedented event, the likes of which none of us have seen in our lifetimes. Coronavirus (Covid-19) has swept through the United Kingdom and the world like a firestorm, infecting residents and forcing us indoors and locked down. Whilst essential to curbing the spread of the virus, lockdown means the scary prospect of reduced income for most of us.

If you are one of the thousands in the UK who suddenly find yourself in a very different financial situation than a month ago, regularly check back to the Oakam blog for tips on managing your financial health during coronavirus.

To discourage mass redundancies, the UK government unveiled a substantial financial aid package aimed at helping employees who companies can no longer afford to pay due to coronavirus but want to keep on the payroll (also known as “furloughed” employees). In this case, the government will provide a significant portion of their salaries – 80% or up to £2,500 per month – during the coronavirus crisis.

As of this week, government aid is extended to self-employed workers as well.

If you find yourself furloughed, here are five steps to take immediately.

1. Ensure your employer filed the correct paperwork

These are confusing, fast-evolving circumstances. Don’t assume that your employer has received clear instructions for how to properly furlough employees. Whether you work for a large corporation or a small business make sure to confirm your company has correctly changed your working status with HMRC in order to not hold up any benefits owed to you.

Here, the government website lays out steps that businesses must take in order to access support from the Coronavirus Job Retention Scheme:

“…

• designate affected employees as ‘furloughed workers’ and notify your employees of this change – changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation
• submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal (HMRC will set out further details on the information required)”

2. Check your eligibility to receive Universal Credit

Just because you are on furlough doesn’t mean you’re ineligible for other types of assistance. There are a variety of scenarios – like needing support to pay rent – that can make you eligible for additional aid, particularly during this health and economic crisis.

If you are low income and affected by coronavirus – whether through illness or financial downturn – check your eligibility to Universal Credit and to Working Tax Credit claimants.

Universal Credit is a relatively new, broad term replacing six legacy benefits:

• Income-related Employment and Support Allowance (ESA)
• Income Support
• Income-based jobseeker’s Allowance
• Housing Benefit
• Child Tax Credit
• Working Tax Credit

Important: If you have coronavirus and are staying home, you are now able to claim Universal Credit. If needed, you can access advance payments upfront without attending a jobcentre.

3. Avoid making drastic decisions

• Resist the urge to stockpile: We have all been to our local supermarket and seen queues in the front and bare shelves and panicked shoppers on the inside. As tempting as it is to overbuy, grocery chains assure the public that stock will be continuously replenished. There is no reason to buy excessively large quantities as this deprives vulnerable shoppers – like the elderly and physically disabled – from having access to food and other items they need. Stockpiling of perishable foods also contributes to unnecessary food waste.
• Follow the rules: If you don’t feel sick with coronavirus and don’t know anyone who does, instructions to stay inside all day (minus one hour for exercise and food shopping) and practice social distancing can be confusing. Health officials are very clear on the need for self-isolation and social distancing in order to slow the spread of the virus. A large portion of those infected with coronavirus don’t show symptoms and might not even know it. They are still contagious. For more on why you
  should adhere at all times to these protective measures, read this article by
  Public Health England.
• Beware of fraud and scams: In the middle of the confusion, fraudsters are trying to scam the public.
  Watch out for opportunities that appear too good to be true – from imitation hand sanitisers and fake coronavirus “cures” to bogus demands for donations. Criminals are taking to the internet, telephones, and email to solicit money even more than before, especially targeting vulnerable citizens like the elderly.

4. Check for refunds on cancelled goods and services

Now is the time to take stock of your recurring subscriptions, unused vouchers, and any purchases that you are unable to use due to coronavirus. In many cases, you are eligible for a refund, credit note, service pause, and/or rebooking. Reach out to issuing firms to see what they are doing to accommodate customers during the coronavirus outbreak.

• Look at big expenses first like pre-paid holidays and concerts. Airlines, hotels, travel, and events companies have been inundated with refund demands. Whilst they may be slow to respond, it is likely that these companies have already published their coronavirus refund rules online and have a way for customers to request money back.
• After that, look at recurring payments and subscriptions for services like rail travel (TfL, regional and national rail companies have updated their refund policies), gym memberships, entertainment packages like Sky Sports.

5. Be proactive

If you’re on furlough and know now that your reduced income won’t cover bills for the coming month, don’t wait. Reach out now to speak to utility companies, loan servicers, mortgage providers, and others. During this time of crisis, many companies are working with customers to find payment solutions that best suit both parties.

If you are unable to pay a bill, waiting and doing nothing risks negatively impacting your credit standing.

For Oakam customers impacted by coronavirus, let us know today by logging into the Oakam app and taking our short Coronavirus Customer Impact Assessment survey.
The survey can also be found here

For more information on what Oakam is doing to support customers through coronavirus, check our Coronavirus landing page