Employment advice on Covid-19 and Furlough leave
6th April 2020 by Robin Watson
Covid-19 pandemic has had a profound effect on many businesses, with many employers and employees having to navigate their way through unchartered waters, in particular the furlough process.
Please find below some Employment advice in relation to Covid-19, however with events unfolding and changing on a daily basis we would highly recommend you contact our team today to talk through your query so we can provide the most up to date information.
First and foremost the obligations of an employer is to keep their employees safe, and provide a safe and secure working environment. This is a challenge during this public health crisis, and over-riding attention should be given to the guidelines on social distancing provided by Public Health England, which is broadly that all those who can, should work from home, and people should not attend work unless they can do so in accordance with the guidelines.
On the 16th of March the government published guidance stating that if an individual lives with others and they or someone in their household has symptoms of COVID-19 all members of the household must stay at home and not leave the house for 14 days. This requirement to stay at home is known as ‘self-isolation’.
Statutory Sick Pay
Regulations on Statutory Sick Pay (SSP) were amended in response to COVID-19 to provide that a person ‘isolating himself … in accordance with guidance published by Public Health England’ is deemed incapable of work; satisfying the SSP requirements.
SSP payments can be made to someone who is self-isolating for more than 4 days because of COVID-19, from the first day of isolation.
The Government is also enabling employers to be reimbursed for SSP paid during the pandemic of up to two weeks SSP.
COVID-19 Job Retention Scheme – Furlough Leave
The COVID-19 Job Retention Scheme is a temporary scheme introduced by the government providing all UK employers, from the 1 March, the ability to recover the lower of 80% of the wage cost (employers can tip-up) or £2,500 per month plus associated employer NI contributions and minimum auto-enrolement employer contributions, for employees who are ‘furloughed’.
Furloughed employees are not working, but remain on the payroll. Employees who were made redundant after the 28th of February but are subsequently rehired are also covered. Employees who are sick, have reduced hours or pay will not be eligible.
Furlough Process/ Agreements
Employers should discuss furlough with employees.
As furlough is a change to the terms of the employees’ contract, ideally any changes made should be by written agreement. Placing employees on furlough does alter employment status and likely pay; however it is preferable to the alternatives of unpaid leave or redundancy.
Selection of employees cannot be discriminatory and should be reasonable in consideration of the employers’ financial circumstances and the impact of the pandemic.
Once selected, furloughed employees should be notified and any relevant representative or Trade Union consulted with, if necessary. That will depend on complex rules, please consult Laceys if you are unsure.
The employee must be notified in writing of their position as furloughed. The employer must record the notification in order remain eligible for reimbursement and submit the furloughed employees’ information to HMRC via the specific online portal.
The portal and much-needed detailed guidance is yet to be published and is urgently needed to help employers and their advisors.
Furlough and Holiday leave
One aspect of furlough leave that is causing worry and confusion relates to taking holiday during furlough leave. Until very recently, there was very little to suggest that an employee could not be on holiday and furlough leave at the same time.
This may well still be the case, but ACAS has recently published some guidance that may have inadvertently cast some doubt on the previous position. No advisor or employer can at this stage be certain and hence why detailed guidance is required.
Added to the complication is the fact that the Government also announced that employees who are not able to take holiday, possibly due to the pandemic, can carry over some of their leave to the next two leave years.
This is still a contentious, complicated and uncertain issue within what was a much-welcomed initiative. We are hopeful for more guidance in due course, but you are advised to seek the guidance of an employment specialist before you make any firm decisions on the areas above.
If your business needs support implementing the furlough process, providing employees with notice or drafting of Furlough Agreements then please contact our team today and we will be happy to help.