Liverpool reverse decision to furlough staff after fierce criticism

Liverpool have reversed their controversial decision to put around 200 non-playing staff on furlough after receiving fierce criticism for seeking government assistance during the coronavirus crisis.

The world’s seventh-richest football club sparked outrage on Saturday when announcing they would follow Newcastle, Tottenham, Norwich and Bournemouth in using the coronavirus job retention scheme to cover 80% of wages due to staff whose work has stopped since the football calendar was suspended on 13 March. Liverpool had confirmed they would pay the remaining 20% to those on furlough, with almost 90 of those affected working in the club stores, and would consider reimbursing monies received at a later date.

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But the move, coming six weeks after Liverpool announced a pre-tax profit of £42m and increased turnover of £533m for 2018-19, attracted a barrage of criticism from former players and supporters. The Spirit of Shankly supporters’ union demanded an explanation from the chief executive, Peter Moore, amid concern “about the damage this is causing to our club’s reputation and values”. The local MPs Dan Carden and Ian Byrne plus other politicians, including the mayor of Liverpool, Joe Anderson, and the metro mayor for the region, Steve Rotheram, also held talks with club officials before the U-turn from the owner, Fenway Sports Group.

Moore announced the reverse in an open letter to Liverpool supporters that included a public apology for the tawdry episode. He wrote: “A range of possible scenarios were considered, including but not restricted to: applying to the coronavirus job retention scheme which pays 80% of salary and guaranteeing the 20% payment; applying to the coronavirus job retention scheme with a guarantee to reimburse monies received at a later date and, thirdly, finding an alternative means to cover our furlough costs.

“It is as a direct result of this extensive consultation and our own internal deliberations at various levels throughout the club that we have opted to find alternative means despite our eligibility to apply for the coronavirus job retention scheme. We believe we came to the wrong conclusion last week to announce that we intended to apply to the coronavirus retention scheme and furlough staff due to the suspension of the Premier League football calendar, and are truly sorry for that.”

Liverpool stood to save £1m-£1.5m by putting staff on furlough. Last year they paid £43.8m in agents’ fees and had a £310m wage bill. There has been disapproval at government level of wealthy Premier League clubs seeking taxpayers’ money to help them through the crisis but despite the U-turn, which echoes FSG’s reverse and apology over a proposed ticket-price hike in 2016, Moore has warned of a profound impact on the club’s finances.

He added: “Our intentions were, and still are, to ensure the entire workforce is given as much protection as possible from redundancy and/or loss of earnings during this unprecedented period. We are therefore committed to finding alternative ways to operate while there are no football matches being played that ensures we are not applying for the government relief scheme.

“We would like to acknowledge the great army of staff and casual workers who work tirelessly to ensure Liverpool is a club that operates to the highest of standards. But in the spirit of transparency we must also be clear, despite the fact we were in a healthy position prior to this crisis, our revenues have been shut off yet our outgoings remain. And like almost every sector of society, there is great uncertainty and concern over our present and future.

“The club continues to prepare for a range of different scenarios, around when football can return to operating as it did before the pandemic. It is an unavoidable truth that several of these scenarios involve a massive downturn in revenue, with correspondingly unprecedented operating losses. Having these vital financial resources so profoundly impacted would obviously negatively affect our ability to operate as we previously have. We are engaged in the process of exploring all avenues within our scope to limit the inevitable damage.”

The manager, Jürgen Klopp, and a senior player committee of Jordan Henderson, James Milner, Virgil van Dijk and Georginio Wijnaldum have told FSG they are willing to make pay sacrifices to ensure no one at the club loses their job.