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Furlough leave: common questions answered

We’ve had a large number of questions regarding the government’s job retention scheme. Our Which? Legal team has answered some of the most common.

In March the government announced a Scheme to ‘help employers whose operations have been severely affected by coronavirus to retain their employees and protect the UK economy‘.

Employers can ‘furlough’ certain staff and apply for a grant from the government to cover 80% of each person’s usual monthly wage, up to a max of £2,500 a month. 

The Scheme will close to new entrants from 30 June 2020 and is due to come to an end altogether in October 2020.

On 29 May, the Chancellor announced some important changes to the scheme:

From 1 July 2020:

i) the number of employees an employer can claim for in any one month may not exceed the number in any previous claim, i.e. no new people can be added,

ii) employers will be able to furlough people for less than the current minimum of three weeks.

iii) furloughed employees will be able to return to work on a part-time basis for any amount of time and any shift pattern. Employees will be entitled to be paid in full for any days worked, whilst the employer can submit a claim under the Scheme for days not worked (subject to the relevant salary caps).

From 1 August 2020:

Employers will be required to pay the following contributions towards furloughed employees’ furlough pay:

August: the employer national insurance contributions and employer pension contributions on the furlough pay.

September: 10% of employees’ 80% furlough pay. Recoverable furlough pay will be capped at £2,187.50.

October: 20% of employees’ 80% furlough pay. Recoverable furlough pay will be capped at £1,875.

As furloughed employees can return to work on a part-time basis from 1 July, the new caps will be proportional to the hours not worked.

On 12 June the government published further guidance on how the Scheme will operate between July and the end of October.

The Scheme applies to anyone who is furloughed “by reason of circumstances as a result of coronavirus or coronavirus disease”. An employer cannot apply for a grant if to do so would be “abusive or is otherwise contrary to the exceptional purpose” of the Scheme.

Guidance on the scheme is continually being updated, but the team here at Which? Legal has done its best to answer some of the most common questions we’ve seen so far.

Read all the latest COVID-19 news and advice on our dedicated hub

Who’s eligible for the furlough scheme?

From 1 July 2020 employers can only claim from the Scheme in respect of employees who were furloughed on or before 10 June 2020, with the exception of those who are returning to work following a long period of statutory family leave, e.g. maternity or shared parental leave.

Prior to that, any employer within the UK was eligible to claim, but they could only furlough staff that were on their PAYE payroll on or before 19 March 2020. This included staff on ‘zero-hours’, fixed-term or temporary contracts.  

Anyone who “stopped working” on or after 28 February 2020 but before 19 March can be furloughed if they were re-engaged by their former employer. However, there was no obligation on their employer to do so.

People hired after 19 March 2020 have never been eligible to be furloughed.

The scheme does not apply to the self-employed – they may qualify for support under the Self-employment Income Support Scheme.

Can you still undertake work whilst you are furloughed?

Currently you cannot do any work for any employer that has furloughed you, but you can undertake training.  

You can work for another employer (providing your contract of employment does not prevent you from doing so, or your employer consents). However, you cannot work for any business that is associated with or linked to your employer. 

From 1 July you can return to work for your employer on a part-time basis (see above). If your employer wants you to begin working part-time they will need to send you a new furlough agreement to sign outlining the circumstances in which they may require you to attend work.

You can do volunteer work whilst on furlough, providing it is not for your employer. 

Can you forced to take holiday whilst on furlough?

Any employer considering asking someone to take annual leave should check that they have the right to do so under the contract of employment.

If the contract doesn’t mention anything on this point, your employer may still be able to require you to take leave; by giving you prior notice equivalent to at least twice the length of time they want you to take off. For example: if they want you to take one week’s holiday they would need to give you at least two weeks’ prior notice.

Depending on the circumstances, there may be arguments to resist being placed on compulsory leave. This can be complicated; if you’d like more in-depth, affordable advice from a legal adviser on this point, you can call and join Which? Legal.

What pay should you receive if you take holiday whilst on furlough?

Perhaps surprisingly, this is a complex and, as yet untested, legal grey area. However, the general consensus appears to be that you should receive your normal pay for any holiday taken whilst on furlough leave. This view is supported by the government’s guidance on holiday and pay whilst on furlough, and separate ACAS guidance. Therefore, there is an argument that your employer should make up any shortfall in your pay.

Can you be furloughed more than once?

Yes, multiple times. From the 1 July, the minimum furlough period of three weeks will be removed so employers will be able to allow people to gradually return to work, i.e. on a part-time/flexible basis.

If you have jobs with different employers, you can be furloughed from one or both jobs.

What is the procedure for employers to end furlough leave?

The government has not outlined a particular mechanism for employers to end furlough leave and bring people back into the workplace. Ideally, your furlough agreement would provide for the circumstances in which furlough ends and how much notice your employer should give you before requiring you to attend the workplace.

In the absence of anything in your furlough agreement about this, your employer should aim to give you reasonable notice. What is ‘reasonable’ will depend on your individual circumstances.

ACAS have prepared some guidance about returning to the workplace which encourages employers to speak to its staff about their plans to work, including any planned changes to the workplace to minimise risks, e.g. providing hand sanitiser, changing start times (to avoid rush hours), amending working hours/patterns to avoid too many people being in at the same time.

Concerns about returning to the workplace

If you have concerns about returning to the workplace you should raise them with your employer in the first instance.

If you are able to work from home, this may well resolve the issue. If not, your employer should consider the current public health advice and the specific circumstances and reason why you are concerned about attending work. For example, if you have school age children but schools remain fully closed, you may be entitled to take dependant’s leave, holiday or unpaid leave (with agreement of your employer).

You also have certain rights; including the right not to be dismissed or suffer any form of detriment for raising certain health and safety concerns. If you have such concerns you should take legal advice to understand your potential rights.

Can your employer still make you redundant?

Yes it can – either whilst you are furloughed or afterwards. Being furloughed does not affect your normal redundancy rights. 

What are the alternatives to furlough leave?

Your employer could ask you to take a temporary (or permanent) pay cut and/or reduce your working hours.

Your employer could also ask you to stop working for a while (a ‘temporary lay-off’), or work fewer hours (‘short-time working’). However, they would need either your agreement or a contractual right to do so. 

The above information is provided by Which? Legal. Have you been placed on furlough leave? Do you feel you were given all the information you needed around the scheme?

Comments
Martin Cobley says:
19 May 2020

I am On furlough I have become unwell to do My job as of been a manual handling job, can my employer sack Me or as he’ puts it Lay-me off.

Hi Martin. Your employer can terminate your employment while you are furloughed. However, your employer would need a potentially fair reason to dismiss (capability or redundancy are potentially fair reasons) and it would then need to act reasonably in dismissing you for that reason.If you have any further questions not covered on this convo, Which? Legal offers affordable legal advice. If you not already a member, you can join and make an appointment for us to speak by phoning 0117 405 4854. You can also join the service online.

My granddaughter has worked for the local pub on and and off for the last 2 years while she is at Uni.Maybe doing 3-4 shifts per week. The landlady says she has applied for her staff,mostly part-time,to be furloughed but HMRC says they are not eligible to be furloughed. Staff have been paying NHI and do appear to be on a payroll. But it seems a bit fishy. The landlady says she has been trying to get HMRC to explain why but they will not furlough. In the meantime none of the ‘furloughed’ staff mostly youngsters like my gdaughter have not received any money. The landlady will not give any detail. I think she’s really been paying cash in hand. What should my gdaughter do? the HMRC website says it cannot help.

Hi G Davison. Thank you for your post. As mentioned in our above article, ultimately, it is the employer’s decision as to which staff it furloughs. If your Granddaughter hasn’t been paid what she should have been by her employer, whilst furloughed or otherwise, she may have a claim for breach of contract and/or an unlawful deduction of wages. There are time limits for bringing such claims (see Acas’ website for details). If you have any further questions in relation to your Granddaughter’s situation, you may wish to make an appointment with Which? Legal. If you are not already a member, you can join and make an appointment by phoning 0117 405 4854. You can also join the service online.  

Colin Revill says:
21 May 2020

My employer has based my furlough payments on my average pay for 2019. But I was on the sick for six months, so they have used sick pay for the calculations. Are they doing the right thing or should they use what I would have earned if not on the sick for there calculations

Hi Colin. At a minimum, your employer must pay you the lower of 80% of your regular wage or £2,500 per month. The way your employer should work out 80% of your usual wages is different depending on the way you are paid (ie. whether you receive a regular salary or your pay varies). You can use the calculator, in the attached Guidance: ‘https://www.gov.uk/guidance/work-out-80-of-your-employees-wages-to-claim-through-the-coronavirus-job-retention-scheme’ to work out what your employer can claim for employees who are paid either regular or variable amounts each pay period.

What about any arrangements for fixed-term contract workers, such as maternity cover contracts, where they finish e.g 31 May, but the firm has a hiring freeze, so no renewal possible?

I have been told that I am not eligible for furlough, as the end of my contract is not-CV19 related, so as of 31 May, I am without any help.

Hi K Receveur. Employees on fixed term contracts can be furloughed – provided there is a connection between putting you on furlough and the consequences of COVID-19, the purpose of the scheme will be met. However, as mentioned above, it is the employer’s decision as to which staff it furloughs. In addition, from 1 July, employers can only claim from the CJRS in relation to employees who were furloughed on or before 10 June 2020.

Carole chrzanowski says:
26 May 2020

I have two separate contracts with my employer as I work two separate jobs for the company.can I be furloughed for one contract and still work the other

Hi Carole. If you have more than one employer, you can be furloughed for each job as each job is separate. If you have two contracts with the same employer, you can be furloughed, but under the terms of the CJRS you could not do any work for your employer whilst furloughed. Therefore, it would appear you could not be furloughed from one position and not the other. From 1 July 2020, furloughed employees can return to work for their employer on a part-time basis.

My son and his wife were put under the furlough scheme from 27/3/2020 to 27/4/2020 (4 Weeks). Their Employer stated they would be paid 80 per cent of their salary. In their April pay salary they did indeed receive the 80 per cent as agreed. However on returning back to work imagine their astonishment when they were informed by text that their employer would be paying them an extra 20 per cent for two weeks of the month they were on furlough but would take off them in the process two weeks annual holiday. Now the point is according to what I have gathered employees placed on furlough pay could not by definition be classified as being on holiday and would continue to accumulate their normal annual holidays. I would be grateful for any advice regarding this matter.

Hi Tony1952. Employees continue to accrue annual leave while on furlough. If their employer required them to take part of furlough as annual leave, their employer should check they have the right to do so under their contracts of employment. If their contracts are silent on this, then it is possible that their employer could rely on the right under regulation 15(2) of the Working Time Regulations 1998, This requires an employer to give someone twice as much notice as the amount of annual leave they are requiring them to take. If they haven’t given them appropriate notice (from the information you have provided, it sounds like they weren’t given any notice and told after the event), they cannot deduct the two weeks from their annual leave entitlement. Your Son and wife should either raise this with their employer informally, or formally (by way of a grievance). In any event, any holiday taken during furlough should be paid at their normal rate of pay. I hope this provides some clarity.

Jue says:
1 June 2020

I work 32 weeks a year, I am off now for the next 16 weeks, my wages are pro rata. I have had £600 a month took off me every month, to cover my wages when I am off.
My employers have furloughed me, even though I am not in work, can they do this even though I pay myself.

I was working from home and then I was furloughed on the 22nd April.
On the 30th April I was diagnosed with Breast Cancer and my operation took place on the 11th May.
From the 12th May the hospital gave me a sick note for two weeks, which ended on the 26th May and my consultant gave me another note until the end of June.

I was wondering how does this affect my pay? I was told by HR that I had to hand in my sick note, just in case I got called off furlough and back to work.
Will I still get furlough and the 20% from the employer or will I be put on the employers sick leave (at present, I will only get 2 months full pay and half pay then after as via their policy and service) and then SSP?

Thank you

Cerys Woolley says:
1 June 2020

I worked at a train station thought an employment agency. The agency have found out that the station probably won’t need us back. They’ve said because of that we aren’t furloughed anymore. Surely that can’t be right. I know it’s an agency but…

I feel your pain… I’ve been working as a Health and Social care lecturer via an agency teaching for a college from my home. The college breaks up for the summer term soon and because I will continue teaching up until the summer term starts, I haven’t been furloughed either. So much for taking care of Key Workers in times of need.. this is the thanks we get! I have a large group of students achieving qualifications in health and social care next month due to my efforts.

2 of my employees, 1 Latvian and 1 Romanian, were furloughed from 13 March until 18th of May when they decided they were going home to there respective countries during lockdown as they no longer wished to work for us. I gave them all monies owed in their last pay packet and gave them their P45. They were under the impression that we would still pay them furlough money until we started trading again, whilst they were living in their home countries. I disagree. We cannot pay them UK government money whilst they are overseas and unavailable for work but I can find nothing online about this. To me it’s common sense, they disagree. Any thoughts?

Isla says:
16 June 2020

It is not clear from your post whether the employees resigned or they were dismissed – presumably for reasons of redundancy. It is important you have the reason for termination, so there is no claim against you for unfair dismissal.

However, GOV.UK website states: “You’ll get a P45 from your employer when you stop working for them.”

So this suggests they are no longer your employees. You can no longer furlough them.

My emplyer (a charity), has continued to pay my full salary, despite there not being so much work for me whilst in lockdown directly as a result of the virus. They may not be able to sustain this much longer as thier income has decreased. To oarticipate in flexible furlough I need to be fully furloughed for 3 weeks. Can a volunteer do my job during those 3 weeks?

Hi Rebecca. Volunteering can only be done if it is not being used to circumvent the rules of the CJRS. Currently, employees cannot do work for their employer whilst furloughed. From 1 July, employees can return to work for their employer on a part-time basis, for any amount of time and any shift pattern, and employers will be able to furlough employees for a shorter period. But to do so, your employer will need to enter into a new furlough agreement with you. See: https://www.gov.uk/government/publications/changes-to-the-coronavirus-job-retention-scheme?utm_source=f85a4ebf-b1bb-42a6-8196-3b5fe4f2e2b8&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate

nithin says:
9 June 2020

HI,

DO I NEED TO BE IN COUNTRY TO BE FURLOUGHED? ALL MY COLLEAGUES ARE GETTING PAYMENT OF 80% BUT THEY SAY I AM OUT OF COUNTRY THEY CANNOT PAY ME AS PER GOVERNMENT RULE, IS IT TRUE? I CANNOT COME BACK TO COUNTRY BECAUSE ITS LOCKDOWN HERE.

HOW DO I PAY MY RENT AND ALL BILLS. ITS REALLY FRUSTRATING. PLEASE HELP

Isla says:
16 June 2020

I don’t believe that is correct.

Say (just for example) your UK employer requires you to work on a temporary assignment abroad and you maintain an apartment there. You are still subject to UK employment law and PAYE. Your employment is also eligible for the furlough scheme, regardless of where you happen to be located at the time.

As far as I am aware, your employer is making up the government rules as they go along.

However, they do not have to furlough you at all. The fact that you are stuck abroad and cannot attend your normal place of work might enable them to claim constructive dismissal, if you cannot carry out your duties from abroad. The fairest option in that case (ignoring the furlough scheme for a moment) would be unpaid leave. So be careful how you play this one.

Fiona says:
10 June 2020

My company is retail. They have put in place a points system when choosing which staff return from furlough. However the majority of staff picked to return to my base store have never worked there and have come from other branches. Essentially, except for management, it will be a completely different workforce. Is this fair?

Isla says:
16 June 2020

Your company has introduced a points-based system. That is good, because it means there is an objective set of criteria for determining who is re-employed first. I am assuming the details have been published, so you can see how and when you might be eligible to return to work?

It is the rules of that system and the outcomes that need to be fair, not the method of selection.

Unless it be shown that the system discriminates against certain protected characteristics – gender, disability, etc., then I can’t see how that could be regarded as unfair.

In terms of your personal position, it depends on lots of other factors. How long have you worked there? Would you be eligible for redundancy, or is your employer effectively doing you a favour by keeping you employed? Or if they are paying you 100% of salary, you are effectively on “gardening leave”, so there is little to complain about.

Simon Culmer says:
10 June 2020

Is it OK to keep an employee on furlough who’s partner is sheltering under NHS advice? We need them back at work but are sympathetic to their partner’s circumstances but if we claimed furlough, are we abusing the system? We will need to hire an agency worker to fulfill their role in the meantime.

Mohamed S says:
11 June 2020

I’ve got a question regarding Furlough Pay, my employer wishes to place me on Holiday leave (without request for the end of June). However, this is against my wishes, intrinsically meaning I will not receive furlough pay for that week, but rather holiday pay. Is this possible to do by my employer and there are any grounds to which I can contest this? I look forward to your correspondance.

Do you know if your employer will continue to claim furlough for you while forcing you to take your holiday entitlement. If that’s legal under the scheme rules it means your employer can reduce their holiday pay liabilities by 80% due to the pandemic and the tax payer picks up the bill.

The upside for you (if you are 80% furloughed) is you will get at least a 20% increase in pay for those holiday days.

Hi Mohamed.

See my reply to Tony 1952 above. The short answer is yes, your employer can require you to take holiday while furloughed, providing they give you the requisite notice (ie. twice as much notice as the amount of annual leave they are requiring you to take). While on annual leave, you should receive your usual holiday pay in full.

The COVID-19 holiday guidance (see the COVID-19 holiday guidance (https://www.gov.uk/guidance/holiday-entitlement-and-pay-during-coronavirus-covid-19?utm_source=458b84c0-5181-43ea-9d13-fd803529f23d&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate) states that “If an employer requires a worker to take holiday while on furlough, the employer should consider whether any restrictions the worker is under, such as the need to socially distance or self-isolate, would prevent the worker from resting, relaxing and enjoying leisure time, which is the fundamental purpose of holiday.” 

Hello I have been working via a recruitment agency throughout this coronavirus pandemic (since Feb) as a Health and Social Lecturer at a college teaching from my own home online via Skype and email. However the college will be breaking up for the summer break the first week of July and I won’t have any income for the summer. The college offered me a perm contract on the 16th March but the job offer letter states that my start date is be confirmed. I have no idea when that
Could be?! Because I have still been busy working for this college via an agency I haven’t been furloughed to be retained but I believe the college expects me to return to work for them in September via the same agency teaching Sociology. What am I meant to do for income during the months of July, August and early September while the college is not teaching and doesn’t need me but expects me to return without retaining me? Help… please advise.. much appreciated. From Susan

Hi. As my staff have been furloughed for so long they have accrued so much holiday and there is limited time left in the year for them to take it. While my staff are furloughed can I insist they take some of their accrued holiday whilst continuing to received furlough payments from the government. I would topup their salary from 80% to 100% during that period. Is this legal under the scheme rules? This would allow me to reduce the financial impact of covid on the business

Alan says:
13 June 2020

I am currently working through the pandemic but some of my colleagues are furloughed, with them off my boss is expecting us to do their jobs as well even though they are in different departments.
Should all furloughed jobs be shut down while someone is furloughed as the government is paying for them to be off and the my company is getting others to do their work so the business still runs.
Should it not be if their job needs done they should be working if its that important??

Amy says:
14 June 2020

Hi, I am currently on furlough (have been since 23rd March!) I just wondered if I was to hand in my notice, how would this affect the furlough pay? I get paid on the 30th June, so are half-way through the month. Would I receive half the pay or would I receive no pay for this month? Thank you!

I am a seasonal part time worker. My company furloughed me but based my wages on a 12 month average. However I only work for 8 months of the year. Can I ask for my average wage to be calculated over 8 months not 12 months please?

Isla says:
17 June 2020

No. But you can ask your employer to base you wage on what you earned in the same month in 2019, if that helps.