Furlough Leave: Update – Clarity for those impacted?
On 20th March, in the midst of the coronavirus crisis, the Chancellor announced the Job Retention Scheme. As you will have hopefully read in my previous posts, the Scheme operates in scenarios where an employee’s role is temporarily no longer required due to the impact of the virus. Rather than employees being left out to dry, the government scheme will pay 80% of wage costs up to £2,500 currently, for a 3-month period, but potentially to be extended.
I have previously highlighted the lack of detail surrounding the scheme; however, since then, I have been made aware of the following information. This information is not official and therefore can’t be relied upon, but it is based upon information which I understand was issued to an MP.
In short, it is believed the scheme will operate as follows:
- The aim is to have the scheme up and running and paying out by the end of April;
- Any employee that started a new role after 1st March 2020 will not qualify;
- The minimum furlough period is to be three weeks;
- There are no intended conditions on being made redundant during or after furlough leave; however, payments will cease should redundancy occur;
- Payments can be backdated from 1st March;
- There will be no assistance for those facing reduced hours or reduced pay; the scheme will only benefit those who are not working;
- Whilst claiming under the Scheme, employees will not be able to work for the employer, but they can join the State Volunteering Scheme and, in some circumstances, will be able to attend work related training;
- The average pay will be based on the greater of 12-month average or the same period in the previous year whichever is higher;
- If made redundant after 1st March, employees can be re-employed and then furloughed.
As I’m sure everyone can appreciate, the fluidity of this situation is making it challenging to keep up! I will provide further updates in due course.
Nigel Tillott, Head of Employment and Regulatory Law, DDI 01452 689100