Barcan+Kirby’s Employment Law team take a practical approach to employment issues. They can help you find practical solutions to the difficulties you face during this time of uncertainty.
There are has already been a lot of discussion in recent weeks around the affect that coronavirus is having on employment and the UK’s workforce, and the guidance is being updated regularly. We have picked out some of the questions our employment solicitors are frequently being asked, and answered them as best we can.
We will keep this page updated as and when anything changes (last updated 15th April), however it’s important that you stay up-to-date with daily government advice as this is ever changing.
What is the Coronavirus Job Retention Scheme?
The purpose of this employment retention scheme is to enable employers to ‘furlough’ employees, which means that they will be granted a leave of absence. As companies and organisations struggle with business and income during this time, it’s an alternative to laying employees off or making them redundant.
If an employee is granted furlough, they will receive 80% of their salary, up to a maximum of £2,500 per month.
All employers are eligible, and the scheme is run through HMRC. You can read more in our recent blog.
What does furlough mean?
The word furlough generally means temporary leave of absence from work. It is an American term not previously used in UK employment law. Furlough leave has been temporarily introduced by the Government during the coronavirus pandemic to allow employers to keep employees on the payroll without them working.
This avoids staff being laid off without pay or being made redundant, and is designed to support employers who are affected by coronavirus. People who get furloughed must not work for the employer during the period of furlough, but usually return to their job afterwards unless redundancies follow.
Do employees have to agree to be furloughed?
Yes. Employees must be consulted and agree to being furloughed. The requirements will depend on the employee’s contract of employment, i.e. if there’s a lay-off provision, but the majority require the employer to agree with the employee that they’re being furloughed.
Most will agree without issue, bearing in mind the main alternative would be dismissal by reason of redundancy with the possibility of a delayed redundancy payment or no redundancy payment (for employees who have worked for less than two years).
As normal employment laws apply when furloughing employees, it is important to be mindful of the equality and discrimination laws so, for instance, choosing a disproportionate amount of men or women could lead to discrimination claims later on.
Are individuals still employed during the leave of absence?
Yes, individuals are still employed by the company and the company reserves the right to recall individuals from their period of leave.
Can new employees be placed on furlough and claim the 80% reimbursement immediately?
No. The scheme is only open to all UK employers that had created and started a PAYE payroll scheme on 19th March 2020 (it was previously 28th February 2020 but this was amended).
The relevant employees must have been on the payroll on that date and would otherwise be dismissed as redundant or laid off. Accordingly, employees hired after 19th March 2020 cannot be furloughed or claimed for under the scheme. The change of date will see approximately 200,000 more people eligible for support.
To count, the employee must have been notified to HMRC through an RTI submission. This can be done at any time between pay days, but typically up to a week before the payroll date. That means those who had started work and been paid by 19th March are definitely eligible, and for those who had not, it is still in the balance.
How about if an employer made an employee redundant before the furlough scheme was announced?
Employees already made redundant or laid off between 28th February and 20th March (when the scheme was announced) can be reinstated and then eligible for the scheme. Employees to be made redundant after 20th March 2020 can be furloughed instead of proceeding with the redundancy process. The scheme will then cover the cost of wages backdated to 1st March (as long as they have not been working). This ensures that those people who already been made redundant as a result of the coronavirus are covered.
Can an employer furlough workers but ask them to work occasionally when there is the need?
No. A condition of granting employees a leave of absence under the Government scheme is that employees do not undertake any work for the company during this time.
Can an employer furlough full-time staff, but allow them to work part time?
This is a commonly asked question for employers whose workers only have enough work for say, one or two days per week, however, the answer is no.
According to Government guidance, to qualify for this scheme, employees should not undertake work for their employer whilst furloughed, which seems to rule out reducing employees’ hours.
If I’ve been furloughed, can I still undertake voluntary (i.e. non paid) work during this time?
Yes. Once you are on furlough, you will not be able to work for your employer, but you can undertake training or volunteer subject to public health guidance, as long as you’re not:
- Making money for your employer
- Providing services to your employer
If workers are required to, for example, complete training courses whilst they are furloughed, then they must be paid at least the National Living Wage/National Minimum Wage for the time spent training, even if this is more than the 80% of their wage that will be subsidised.
Are causal and/or zero-hour contract workers covered under the scheme?
No, unless they work on the PAYE system. For casual and zero-hours contract workers who are on the PAYE system with variable hours, their previous pay can be used as a benchmark for furlough pay.
Am I able to apply for an interview for other jobs during a period of furlough?
We do not yet know what the Government’s advice is on this yet. We will update this as and when we do.
Can you furlough someone who’s on maternity leave?
Employees must take at least two weeks’ maternity leave (four weeks if you work in a factory or workshop) immediately following the birth of their baby. This is a health and safety requirement. In practice, most women start their maternity leave before they give birth and you may want to do this.
If you are eligible for Statutory Maternity Pay (SMP) or Maternity Allowance, the normal rules apply, and you will be entitled to claim up to 39 weeks of statutory pay or allowance. If you qualify for SMP, you will still be eligible for 90% of your average weekly earnings in the first six weeks, followed by 33 weeks of pay paid at 90% of your average weekly earnings or the statutory flat rate (whichever is lower). The statutory flat rate is currently £148.68 a week, rising to £151.20 a week from April 2020.
Some employers ‘top up’ Statutory Maternity Pay and their employees are eligible for an enhanced, earnings related rate of pay. If you are eligible for enhanced (contractual) maternity pay from your employer, this is included within the wage costs that your employer can claim through the furlough scheme. The same principles apply if you qualify for contractual adoption pay, paternity pay or shared parental pay.
If the employee on maternity leave gives their eight weeks’ notice (as per the normal maternity leave rules), they could be furloughed on return if this situation is ongoing. Normal maternity rules will still apply.
Can you furlough someone who’s in their probation period?
Yes (although see above about new employees and payroll dates).
Can an employee who is on their notice period be furloughed for the remainder?
Yes, an employer can furlough an employee until their leave date.
Can employers furlough employees who are currently on sick leave?
Employers can furlough employees currently on sick leave, but they can only claim back either furlough payment or statutory sick pay (SSP) at any one time for any employee. Employees do not qualify for SSP if they are on furlough. The solution to this is for employers to continue to make furlough payments.
If an employer tells an employee to stop working and they are on SSP, or are entitled to it, the calculation of the minimum period of three weeks doesn’t start until this period of SSP has ended.
If an employee becomes sick again, whether or not they receive SSP, this is disregarded for the purposes of calculating the amount of time on furlough.
Can an employee who’s on sabbatical be furloughed?
Employees on sabbatical leave (or those due to go on it) can’t be furloughed until this period of unpaid leave is over.
Can an employee withdraw their resignation and be furloughed?
There is no obligation for employers to accept a resignation retraction but there can be an agreement between the parties if appropriate.
Does an employee have to take annual leave whilst on furlough?
This has not yet been confirmed, but in general, employers do have the right to tell employees and workers when to take holiday. Read more in our blog.
What statutory sick pay is available for those self-isolating and who is eligible?
You will be eligible to receive £94.25 per week Statutory Sick Pay (SSP) payable by your employer, unless your contract of employment states otherwise, if:
- you have coronavirus or you are displaying symptoms
- if you are in the same household as someone showing symptoms
- you have been advised by a doctors to self-isolate
Employees can self-certify for the first seven days and following this, a note should be sought from NHS 111 online, not from a doctor.
Can you claim SSP retrospectively?
The Government’s Coronavirus Bill states that SSP will be paid from the first day you became unwell. This will apply retrospectively to 13th March 2020.
Do employees need a sick note to claim SSP?
No. For the first seven days that an employee is unwell they do not need to provide proof of sickness. After this, if you have coronavirus symptoms or have been advised to stay home, you can get an ‘isolation note’ by visiting NHS 111 online.
What support is available for the self-employed or those on zero-hour contracts who need to take time off ?
If you are self-employed or earn below the Lower Earnings Limit (£118 per week), you will not be entitled to SSP. If you have symptoms or are unable to work, you will be able to make a claim for Universal Credit or Employment Support Allowance more easily as the minimum income restrictions will be temporarily relaxed.
The House of Commons has, in the last couple of days, proposed Statutory Self-Employment Pay. If accepted, self-employed workers can receive 80% of their monthly net earnings, averaged over the last three years or £2,917 per month, whichever is the lower.
If an employee has returned to work from self-isolation and they are still coughing, should they be sent home?
No, if an employee has followed medical and government advice and self-isolated, they can return to work. A cough might seem unsettling for others, however the cough may persist for a few weeks and they are not contagious.
If a workplace shuts due to Coronavirus, what pay are employees entitled to?
If an employer applies to access the Coronavirus Job Retention Scheme, employees will be paid up to 80% of their monthly wage, capped at £2,500. Employers can chose to fund the 20% difference in salary but there is no obligation to do so. Whilst still employed by the company, the employee cannot undertake any work during this period.
Do all employees need to work from home?
Government guidance states that employees who can work from home should be allowed to do so.
Working from home is not mandatory and those that cannot work from home should go into work as long as they are not showing symptoms or living with someone that does.
Do employees have to work if they are self-isolating?
If they feel well enough to work and they can work from home, they should do so. They should be paid in full for the time they are working from home. If they do not feel well enough to work, they are ‘off sick’ and should be paid SSP unless their employment contract states otherwise.
How do you treat an employee in a ‘high risk group’?
If they want to work and can work from home, this is the ideal solution. You do not have to allow working from home if this is not possible. It is advised that employers are familiar with the government guidance on who is considered high risk. These people are being urged to be particularly stringent when following social distancing.
My employer is insisting I go into work but I’m scared of coronavirus. What should I do?
Employers must make all efforts to help its employees to work from home where possible. Ultimately, the reduced amount of contact between people will help limit the spread of the virus.
In some circumstances, such as public transport drivers or NHS frontline workers, this may be impossible. In these cases, if workers do not have symptoms or live with someone with symptoms (or are not vulnerable), there is guidance for employers to help protect these people.
With the exception of some non-essential shops and public venues, the government has not asked any other businesses to close. However, employers should encourage their staff to work from home unless it is impossible for them to do so.
Whether you’re an employer or an employee seeking further information on the Job Retention Scheme, or any other element of employment law, call our specialist Employment solicitors on 0117 325 2929 or complete our online enquiry form.