Coronavirus (COVID-19) Job Retention Scheme - when to address furlough

Last updated: 31th March 2020 15:45

Many employers will be considering whether and if so when to take advantage of the Job Retention Scheme announced by the Government on 23 March 2020.

The main points of the Scheme are

  • a grant may be claimed from HMRC to cover the cost of 80% of salary up to a maximum of £2,500 per month for “furloughed” staff – staff for whom no work is available and who would otherwise be considered for redundancy

  • the employee is furloughed for a minimum of three weeks

  • s/he does no work for the company during that period but remains in employment

  • the employer may top up salary but is not obliged to

  • the consent of the employee is needed

For some businesses the need to access the Scheme is now.  If so, the immediate requirement is to obtain the employee’s consent to furlough.  If this cannot be obtained, then redundancy may be the only answer and this should be made clear to the employee when seeking consent.

For those businesses that may want to consider this in future though there is no immediate need there is much to be said for

  • giving advance notice that this may be a route the company must follow

  • obtaining consent in principle to furlough

As and when the time comes the employee should

  • be advised of the date on which it commences

  • the fact that it will last for at least three weeks

  • be advised that s/he should carry out no work at all for the employer during the period of furlough

Matters employers will want to consider are

  • Do I want to top up salaries so that employees get the same salary as before?
  • How do I decide who to furlough and who to retain working?

Effective communication with your employees will be key here.  Our specialist employee communications team are working with our employment and tax lawyers to provide a customized suite of documentation to guide you through this process.  

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