Extraordinary times, extraordinary measures
Detailed guidance on the Government’s Coronavirus Job Retention Scheme has recently been announced, writes David Mills, Partner at Mills & Reeve LLP.
The offer to reimburse employers 80 per cent of their employment costs (up to a maximum of £2500 a month) to avoid them making staff redundant, first announced on March 20, represents an extraordinary intervention in the labour market.
The scheme is open to all UK-based employers, whether businesses, charities or other organisations (though the public sector is not expected to make extensive use of the scheme).
It will be backdated to March 1 and will be open for an initial period of three months. Any employee on the payroll as at February 28 can be covered by the scheme, unless they were already on unpaid leave at that point.
Staff laid off under the scheme are referred to as furloughed, which effectively means their employment is suspended, but not brought to an end.
It is clear that it is the employer’s decision whether to furlough staff, but that normally the employee’s agreement will be needed (which is likely to be readily forthcoming in most cases).
While it is clear that staff on furlough will continue to enjoy the full range of statutory rights (except in relation to pay) there remain a number of unanswered questions.
These include the extent to which periods of furlough can overlap with annual leave (it is clear that in most cases staff on maternity leave or sick leave will not qualify).
In addition, while staff subject to the shielding guidelines can be put on furlough, it is less certain whether employees who are unable to attend work for other reasons relating to the pandemic are eligible, where they cannot work from home.
More details about the scheme and the related issues that employers needs to address can be found in the Mills & Reeve briefing on our website. You will also find details of other recently announced schemes supporting business through this period on our coronavirus hub – mills-reeve.com/insights/foresight/coronavirus
• For more specific information email david.mills [at] mills-reeve.com