In this article, Cheyanne Greig-Andrews discusses Primark’s decision to reject the government’s proposed retention bonus scheme.
The affordable fashion retailer Primark has been one of the first to announce that it will not be accepting the UK government’s proposed bonus scheme. This is a daring statement as the company prepares to reintroduce all 30,000 of its employees across the UK. If Primark had accepted the government’s incentive, it would have equated to about £30 million in government payouts.
Chancellor Rishi Sunak recently announced the new bonus scheme for businesses that have had furloughed employees. The incentive was created to prevent mass unemployment due to post-lockdown redundancies. The bonus promises businesses £1000 for every employee brought back to work kept on for at least the next 3 months. According to the BBC, there are currently 9.4 million people on the furlough scheme. If all eligible businesses applied for this new retention bonus it would cost the government over £9 billion.
Primark has stated that they don’t believe they must apply for payment under the bonus scheme. A Spokeswoman from the company has confirmed that “Primark does not intend to take advantage of support under the Job Retention Bonus announced by the Chancellor this week”.
This is a bold move for the fashion retailer and will likely set a precedent for other well-established fashion brands to follow suit. John Lewis has reportedly followed Primark’s lead, rejecting £14 million in government bonus. Decisions like this will hopefully prevent further economic downfall from the recent pandemic and allow for more government support to smaller retailers and creative industries who have struggled significantly in recent months.
There is no doubt that the recent pandemic has had a major impact on fashion retailers globally. Primark’s decision to reject the UK bonus scheme is a reminder of the ways the fashion industry can use its leverage in order to support the greater good.
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