COVID-19: What’s ‘Furlough’ and the ‘Coronavirus Job Retention Scheme’?
The Government has introduced the Coronavirus Job Retention Scheme, under which all UK employers will be able to access grants to continue paying part of their employees’ salaries, for employees who would otherwise have been made redundant following the COVID-19 outbreak.
Under the scheme, employers can designate employees as ‘furloughed workers’ (which is a term used widely in the US to describe people who are made redundant), although employees have to agree to the change.
HMRC will reimburse 80% of furloughed workers’ wage costs to employers, up to a cap of £2,500 per month.
Further details of the scheme have not yet been confirmed by the Government, but we will update members via our online COVID-19 Hub as the information is published. The Affinity COVID-19 Hub can be accessed here.
Advice For Members:
1. Employers need to get agreement from employees before designating them as ‘furloughed’. Unless the contract of employment already covers it (which is unlikely), staff will need to sign an additional agreement coving information such as when furlough starts and when it will be reviewed. We strongly advise members to send us a copy of the furlough agreement to check before signing. Please contact the Advice Team on 01234 716005 (choose Option 1) if you’re asked to sign a furlough agreement.
2. You may feel reluctant to be furloughed because you’re concerned that you’re only going to receive 80% of your normal salary, but that’s not necessarily the case. Employers have the discretion to ‘up’ the furlough pay by 20% so staff receive their full pay (but it’s not compulsory for them to do so). Members need to ask their employers whether or not they will be making a top-up payment and ask for confirmation of the position in writing.
3. Employees can only be furloughed if they would otherwise be made redundant. If you believe that you’re being furloughed without good reason, please contact the Advice Team immediately on 01234 716005 (choose Option 1).
4. If you refuse to be furloughed without having a good reason for refusing, you might be made redundant.
5. It’s important to note that people who are furloughed cannot engage in work; in other words, you can’t receive furlough pay and work elsewhere. It is widely believed that furloughed workers will be able to volunteer or engage in training, as long as it does not generate any money for their employers, but this has not yet been confirmed by the Government.
If you have any other questions about the Coronavirus Job Retention Scheme, please contact the Advice Team on 01234 716005 (choose Option 1) or email us at email@example.com.