Law firm Osborne Clarke has repaid back in full the money it received as part of the government’s employee furlough scheme.
In April 2020, the organisation furloughed 116 employees after forecasting a significant reduction in revenue due to the Covid-19 (Coronavirus) pandemic. However, due to the business performance exceeding expectations during the months to follow, it returned all employees from furlough by 3 August and returned the money to HM Revenue and Customs.
As well as furloughing a number of employees during the pandemic, UK employees who earn over £30,000 have been subjected to a 7% pay reduction for an 11-month period; from June 2020 until May 2021. However, if the organisation reaches its revenue targets for 2020/2021, it will backdate pay for all of its employees that have been affected by this reduction.
Employees who are affected by these reductions have retained all of the existing benefits offered by the organisation, with pension contributions being paid in line with their unadjusted salaries. However, the law firm has decided to delay bonus reviews for the foreseeable future.
Ray Berg, managing partner, at Osborne Clarke, said: “As the summer progressed, client instructions, billable hours and cash flow did not reduce to the extent we had feared. We were then pleased to bring back these people and exit the furlough scheme by 3 August.
“As we approach our UK half year, while revenue is below our original target which was set pre-Covid 19, it has held up better than we had initially feared.
“Osborne Clarke remains a profitable and growing firm. We, therefore, made a decision to repay the funds we received from the UK government under the furlough scheme. This money has been taken from the firm’s UK profit. It will not have any impact on whether or not we hit our revised 2020/21 financial target.”