Following our recent employment Q&A webinar we have put together a summary of some of the most frequently asked questions relating to furlough and other issues.
With guidance changing so frequently, we are doing our best to keep you up to date. This information is our understanding at this point of time, however as more and different advice becomes available this position may change and we will update accordingly. This is an evolving and unfolding situation, and we take the view that different measures may need to be applied for different sets of circumstances at an appropriate time. We as a team are available to discuss with you what measures are available to you.
Updates since the last Q&A webinar:
- The HMRC portal to submit claims opens on Monday 20th April 2020.
- The furlough eligibility cut off date has changed from 28th February to the 19th March – meaning that employees on payroll from 19th March can be considered for furlough.
- Detailed records and information used to make decisions on whether an employee qualifies for furlough should be kept.
- All employees who will be furloughed should be notified in writing, with the employee agreeing to cease working for the employer in order to be eligible for furlough. The written correspondence should be kept for a period of 5 years for HMRC audit purposes.
- The job retention scheme has been extended until the end of June.
Q: The UK government announced that workers should be able to carry over 4 week’s annual leave over the next 2 years, but some questions that arise from this: What if that is not really suitable / desirable for our business to have employees carry forward so many days leave? Can we still ask employees to take annual leave this year / at a time that is more suitable to the business? (Personally, I worry about the impact on mental health if someone were to not take any holidays for a whole year).
What if an employee carries forward a lot of annual leave, but then resigns their post early next year? Is the company obligated to pay them for that untaken annual leave? And if so, is that at full salary or is there a minimum amount?
A: In line with the new legislation surrounding holidays/carry over, this permits employees to carry this over for a period of two years therefore, dictating when holiday carry over is to be used by e.g. in the first there months of the next holiday year would be a contradiction of this. The mental wellbeing of employees is important and employers should still encourage employees to take annual leave where possible. The legislation was updated for employees who are unable to take holidays due to coronavirus and being required to work e.g. key workers but in practice extends to all employees.
If an employee resigns, their holiday entitlement would be prorated accordingly however, yes, any accrued untaken holidays would need to be paid in their final salary.
Q: If I put salaried staff on furlough maybe for the suggested 3-month period and during that time or shortly thereafter, the company goes into liquidation, will the staff then be entitled to redundancy payment?
A: If the Company goes into liquidation, yes, employees would be entitled to redundancy payment. Without specific details, it remains to be seen who would be liable for the payment e.g. the employer or the government. If anyone has a specific query on this, please get in touch with a member of the Gravitate HR team or TC Young.
Q: We sent our employees the furlough letter on the 29th of March as we furloughed all of team officially from the 1st of April. With the update to the job retention scheme now stating the furlough qualification date has been changed from 28th February 2020 to the 19th March 2020, can I backdate the furlough period as some staff stopped work on the 23rd March and 25th March?
A: The update means that any employee who originally would not have been eligible for furlough can now be furloughed, providing that they were on the payroll on 19th March 2020. The original backdate of 1st March remains in place and has not changed since the scheme was announced. This does not necessarily mean that all employers should backdate their claims, especially if their original written correspondence to employees states a later furlough date. This could be considered an abuse of the system and if HMRC carry out furlough spot checks in the future, this may be flagged and could have potential consequences.
Q: If a member of staff has been furloughed for 3 weeks already, can they return to work for a short period and then return to furlough leave? And, in that case, would the 2nd period of furlough leave need to be a further 3 weeks or can this be a shorter period?
A: Yes, you can change employees from ‘furlough’ to ‘employed’ and then back to furlough as long as the 3-week furlough period is adhered to. Please note that there is no minimum term that employees have to be ‘employed’ for e.g. if you move an employee from ‘furlough’ to ‘employed’, you could realistically then move them back to furlough after a few days if necessary. Each further period of furlough would need to be for a minimum of 3 weeks. Each period of furlough should also be confirmed in writing – the written notifications are required to be kept for a period of 5 years for HMRC audit purposes.
In order to make this easier to manage, employers could consider assessing the workload and keeping only specific employees employed on their original terms while the rest of employees are all furloughed. This reduces the need to keep changing an employee’s status. Furlough should only be used when there is no work for an employee.
Q: Can an employee on maternity leave decide they want to return to work early and then be furloughed?
A: Essentially, they can however, employees wishing to return to work from maternity leave are required to give a minimum of 8 weeks’ notice to their employer. It is also worth noting that if an employee decides to return to work and then move to furlough, this will break their maternity leave. If they are furloughed and then the lockdown ends and business returns to normal (or even if lockdown continues but they are reasonably required to restart work), they would be required to return to work and wouldn’t be able to resume their maternity leave.
This works similarly with sickness absence. If an employee is on long term sick but has exhausted their sick pay and decides to declare themselves fit for work so that they can be furloughed and receive 80% of their salary but lockdown subsequently ends, they will be expected to return to work. Also, if they declare themselves fit for work and their employer deems them as necessary and that there is enough work for them, the employee will be expected to return to work and wouldn’t be furloughed.
With the furlough portal opening on Monday and with an estimated 9 million people now furloughed the question is what happens next? The next chapter of furlough holds many challenges and many unknowns. In this webinar we are going to be sharing with you the furlough stories, challenges and solutions that we have been helping our clients manage over the past weeks.
We hope that by sharing some of these scenarios, challenges and solutions it helps you manage your furloughed team.
Date: Tuesday 21st April
Time: 12.30 pm – 1.00 pm
Platform Zoom, Register in advance for this webinar: