Mother returns furlough cash

Independent shop has paid back the six-figure sum it received under the government’s Job Retention Scheme after bouncing back from the initial financial shock of the pandemic.

Mother: returning furlough cash
Mother: returning furlough cash

Mother London, backer of PR shop The Romans, has become the first agency to confirm it is returning the money it received from the government for furloughed staff after ending the year at a profit.

In April – amid the first and most stringent lockdown – Mother looked to preserve its cash flow by putting 32 of its approximately 200 staff on furlough and introducing a salary-deferral scheme for employees paid more than £30,000.

But, amid the ongoing pandemic, Mother bolstered its client list with 16 additions – including Bumble, Doritos, Gousto and Samsung – and expanded the work it does for existing partners such as KFC, Ikea, Stella and Uber. Mother estimates its new clients account for almost 25% of this year's revenue.

Everyone who was placed on furlough – including some production specialists and others in operational roles such as receptionists and catering – was back at work by August. Mother has now repaid hundreds of thousands of pounds it claimed for their wages to the government.

Mother originally planned to return the salary its employees deferred – which worked on a proportional sliding scale – in December 2021 but has now reimbursed all staff early as a result of the agency’s performance this year.

Mother is understood to be the first agency to pay back furlough money but businesses in other sectors have started to return the funding, as well as other types of government support.

Michael Wall, global chief executive of Mother, said: “We were grateful to the UK government for releasing these funds at the start of the pandemic. As our year went on, and thanks to the hard work and commitment of our team, we found ourselves in the fortunate position of not needing the financial support. So we’re returning the money.”

Mother's sister agency The Romans did not place any of its staff on furlough and has increased its headcount by eight, PRWeek undestands.

Telegraph Media Group and sister title The Spectator were among the UK media companies to return furlough money in the summer.

Tesco received plaudits when it became the first supermarket to say it would pay the £585m in business rates relief it received as part of the government’s support for bricks-and-mortar retailers navigating the impact of the pandemic. 

Sainsbury’s, Asda, Morrisons, Aldi and Lidl have since followed suit.

A spokesman for HMRC said it could not comment on specific companies, but it did confirm this week that more than £500m in furlough money has so far been returned to the government.

A version of this article first appeared on PRWeek sister title Campaign

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in