Getting back to work: An update on furlough

In April, it was revealed that a combined 11,000 staff from some of the energy sector’s largest companies were being placed on the government’s job retention scheme.

Furlough is set to end next month and the major energy suppliers have told Utility Week that most workers have already been brought back. However, industry observers have warned that with the government adamant furlough will not return and suppliers set to face a financial squeeze in the winter, job cuts could be on the horizon.

Sue Ferns, senior deputy general secretary at the Prospect Union, says the sector has not had as much reliance on furloughing staff as other areas of the economy have.

“By and large, outside of those retail functions, we haven’t seen extensive use of the furlough scheme across the energy sector. I am pleased about that because I don’t think we should do. It’s an essential role and therefore it’s important that people have kept on working. Apart from in other areas of the business, I don’t see that there’s been a pressing need for employers to furlough people”, she said.

Eon furloughed 4,000 staff in total, the highest of any company. This figure includes 1,000 of the 5,500 Npower workers acquired as part of a wider asset swap with Innogy’s parent company RWE.

A spokesperson told Utility Week that around 2-3 per cent of its Eon workforce is still on furlough, with that number consistently decreasing. They added most staff were still working from home but the company was keeping this under review as things develop.

Of Centrica’s 3,800 staff placed on furlough, all have since returned to work. The company says it does not plan on more job cuts, outside of the 5,000 it announced as part of a dramatic restructure in June.

Ovo, which furloughed 3,400 staff, later announced it was cutting 2,600 jobs and cited the pandemic pushing customers towards online and reducing demand for certain roles.

The company says 185 employees are currently on furlough and that this cohort includes people who are shielding.

Bulb, Shell Energy and EDF all previously said they had no plans to furlough staff. Bulb in fact has continued to hire throughout the lockdown period, a spokesperson said the company had hired 155 new staff remotely over the past few months.

EDF did however furlough around 400 field workers. A majority of these have now returned to work and the company says it expects the reminder to do so within the coming month. A small number however remain on furlough due to health reasons.

Scottish Power remained the only large supplier not to furlough any of its staff at all throughout the pandemic.

Concerns were recently raised about the prospect of a ‘winter of discontent’ hitting the energy sector as more challenger brands feel the economic pressure of the pandemic, and Ferns warns that the financial impact could lead to job cuts. She says that with a high proportion of female staff that would ultimately impact on gender diversity in utilities.

She adds: “With the losses concentrated in the retail sector, it is predominantly going to affect women workers, so there is a clear gender impact I would think.

“Engineering is becoming more diverse extremely slowly, but in retail it is predominantly women workers. They are good jobs in energy and I would say probably amongst the best call centre jobs for terms and conditions and pay. That is going to be a big impact, particularly for women who lose those jobs.”

Andrew Perry, energy principal at Oliver Wyman, agrees that the end of furlough for the customers of energy companies will add even greater strain on the companies themselves.

“Furlough is due to end shortly and we are going into winter, the economy is in a poor position and many people have lost their jobs. I think we will see a double impact with furlough coming to an end for both staff at energy suppliers and their customers. This will lead to a doubling up of pressure, of cost cutting and being able to maintain revenue streams,” he said.