Yahoo Finance Coronavirus: Prezzo finds way to help 3,000 workers to access furlough pay early
Popular Italian restaurant chain Prezzo announced it is rolling out a new system to all its 3,000 staff in order for them to access furlough pay early as the UK remains in lockdown to stop the spread of coronavirus.
The group said in a statement that it is offering its staff “income streaming” via a provider Wagestream, which has been especially designed for the UK government’s Job Retention Scheme. It means that it will pay furloughed workers 50% of their accrued ‘furloughed pay’ on demand, allowing them to draw down (also called ‘income streaming’) a percentage of their earned wages any day of the month for a flat £1.75 ($2.16) fee, without impacting employers’ cash flow.
“We are currently doing everything we can during these difficult times to support our Prezzo people whilst they are furloughed,” said Jacqueline Rouse, people director, Prezzo UK.
Previously this was only available to a third of staff, occupying front of house roles. There are no loans involved and therefore no interest is charged. The practice is intended to reduced the financial stress associated with unexpected expenses thrown up by the coronavirus lockdown without affecting company cashflow.
READ MORE: Coronavirus: 3.2 million furloughed workers 'may not get their jobs back'
On 23 March, the UK government ordered the closure of all non-essential stores, as well as playgrounds and libraries, and imposed a range of drastic measures on public life, in order to mitigate the spread of COVID-19. To date, there have been over 20,000 coronavirus deaths in hospitals in Britain.
The UK’s independent budget watchdog, the Office for Budget Responsibility (OBR), said that the UK economy could contract by as much as 35% in the second quarter of 2020 if the current lockdown persists for three months. In this scenario, unemployment is expected to rise to 10%, compared to 3.9% at the start of the year. That would equate to 2 million extra people out of work.
The UK government then launched the Job Retention Scheme to help businesses weather the impact of the coronavirus pandemic. This means the state will pay up to 80% of furloughed worker’s pay while companies will have to decide if they top up the remaining 20%.
Currently, the lockdown is in place until 7 May. By law, politicians have to review whether lockdown measures are effective in combating the spread of coronavirus and whether it is deemed safe to ease restrictions, with help from scientific experts and advice.
In the government’s daily press briefing on Sunday (26 April), Whitehall said it was too early to assess whether lockdown measures should be lifted.
