I’ve Been Furloughed– What Now?
The UK Government's "Coronavirus Job Retention Scheme" is designed to save jobs and help maintain economic stability during and after the Corona crisis. Tens of thousands of workers are already affected. We look at what that means, what you can do, and where you can find out more.
What does it mean?
Furlough is the government scheme to support companies in the UK that are being hit hardest by the Coronavirus. The idea is that the Government will give money to firms towards wages keep you employed so that they don’t need to make you redundant. You can be kept on the payroll even though you aren’t doing any work. Your employer is less likely to go out of business, or need to reduce headcount, during the crisis. Businesses can claim up to 80% of wages, up to £2,500 for each person per month. Companies can choose to top that up if they want to. Your company must write to inform you formally. You don’t have to consent to be furloughed , but should take professional advice on any alternatives such as redundancy which may be less attractive.
How long will it last?
The shortest period you can be furloughed for is three weeks, but you can be furloughed more than once. The Government has indicated the scheme may run past the initially planned end date in May if needed. Ultimately the plan is that furlough ends as economic restrictions ease and companies can return to paying full salaries as business picks up.
Will I still have a job when furlough ends?
That is the hope, but there are no guarantees. The furlough scheme is designed to safeguard as many jobs as possible, helping firms to stay afloat during the lockdown to prevent unemployment. Your employer is under no obligation to keep you on when you stop receiving furlough, but they can’t use furlough payments as part of redundancy packages.
What about Sick Pay? Maternity? Isolation?
You still have the same statutory employment rights. If you are unwell you are eligible for statutory sick pay and can go on furlough when you recover. If you have caring responsibilities or are shielding or isolating because of health concerns, you are still eligible to be furloughed. If you are on shared parental, or maternity, paternity or adoption leave, you will continue to get your statutory pay from the Government. Companies that offer enhanced parental leave pay can furlough employees to receive support with the cost of the additional payments.
What happens with my bonus and commission?
The scheme is limited - broadly the Government will cover up to 80% of your base salary, up to £2,500. Recently updated guidance now says that companies can include commission payments if they are regular “Compulsory Commission Payments” that the company is obliged to pay - but not ‘discretionary commission’ which is still excluded. We are still waiting on the latest guidance on how exactly these are defined, and interpretation may depend on individual contracts and agreements. The scheme does cover the minimum automatic enrolment pension contributions, and the National Insurance payments that your employer makes.
I’m not salaried – what do I get?
If your pay changes due to flexible working or a ‘zero hours’ contract, your employer must base your furlough pay either on your average monthly earnings for the 19/20 tax year, or what you earned in this month last year, whichever is higher.
My boss still wants me to work, can they do that?
No. You can’t do any ‘work’ for your employer while you are furloughed. You CAN volunteer for your company as long as you aren’t creating revenue for them or providing a service. You can also still complete training for your employer – but if you spend time in training your employer needs to ensure you are getting at least minimum wage. If you have more than one employer you can be furloughed by more than one. You can also be furloughed by one employer and continue to work for others. You can also work for a new employer, as long as you are not breaching any existing contracts.
You are not alone. These are extraordinary times, and there are thousands of UK workers in the same or similar position. The scheme is designed to prevent unemployment. Tens of thousands of workers from industries like hospitality, travel, fashion and manufacturing are impacted. Ultimately it is a measure to protect jobs, so can be seen as a positive.
Where can I get more information?
The Government launched the furlough scheme quite quickly and is updating and increasing available advice, (for example clarifications regarding commission payments). The latest information is available here for workers, and here for businesses.
If you have concerns or questions about how your employer is using the furlough system, or need some free, impartial advice, then visit the Advisory, Conciliation and Arbitration Service (ACAS) https://www.acas.org.uk/ and citizen’s advice https://www.citizensadvice.org.uk/work/coronavirus-if-your-employer-has-told-you-not-to-work/