Various changes to the Job Retention Scheme were announced on 12 June. The changes include an increase in employer contributions from August and a reduction in Government contribution from September, with the scheme ending at the end of October.
So, what are the options for your internal staff returning or not returning to work once furlough ends?
Returning to work
Health and safety
Getting back into the office will be music to the ears of many but as an employer, you’ll have to make sure it is safe for your staff to come back. You’ve got legal obligations to safeguard your employees’ health and safety so you’ll need to follow the Government guidance applicable to your workplace and carry out risk assessments for your site but also for high risk categories of people. This will allow you to implement measures like social distancing, provide PPE where necessary, implement hygiene procedures and adjust working practices to protect your staff and visitors.
This is likely to be more the norm as a result of the pandemic. It does take some planning but can benefit you as well as your staff. It can include things like allowing staff to start/finish at times that allow them to avoid busy commutes. Staff could work from home or split their time between the office and home – this could help you to comply with social distancing in the office and easier hygiene maintenance.
Remember, an employee with 26 weeks’ or more service can make an official flexible working request that you can only refuse on certain grounds. If agreed on a permanent basis, it is likely to change their employment conditions.
This might help you retain staff whilst keeping overhead costs down but you’ll still have to make sure you look after the health and safety of your staff even when they’re working from home – whether on a temporary or permanent basis.
Ask your staff to take annual leave
If your staff have any annual leave, you can ask them to take it – if they take it whilst still on furlough, you can use the scheme to claim for holiday pay but remember, you’ve got to top it up to what they would have received for a holiday pre-furlough. Under the Working Time Regulations 1998 you can ask them to take holiday as long as you give them notice that is double the length of the time you want them to take off, i.e. 2 weeks’ notice if you want them to take a week off.
Unpaid leave/pay reduction
You could, by written agreement, ask your employees to take a period of unpaid leave or a pay reduction. Your employee contracts might stipulate whether you are able to do this or whether you’ll need to go through an official process to varying their contracts to allow unpaid leave or a pay reduction.
This is where you don’t provide your employee with work in a week that you are obliged to because of a depletion in workload, closure of business, etc. You can only do this if your contract with the employee allows it. You’ll also have to pay a guarantee payment for those employees who have worked over a month with you, which is currently £30 a day. So, for 5 days, it is £150.
- If you do so without a contractual right, you’ll be in breach of contract so an employee could quit and potentially claim constructive dismissal.
- Lay-off may give rise to a redundancy payment if certain conditions are met. Please take advice.
This is essentially a partial lay-off with a reduction in wages because of a reduction in duties or hours of work, or both. Again, your contract must contain a provision to allow you to do this otherwise you’ll be in breach. You might also have to provide guarantee payments (See ‘temporary lay-off’ above). Again, this may give rise to a redundancy payment, so please take advice.
If you want to vary your employees’ contracts, you may need to consult with them first and seek their agreement to the changes you want to make. An agreement isn’t always necessary if there is already a specific enough provision in the contract that allows you to make variations, but even here you do need to exercise a degree of caution.
If you don’t need all of your staff back
Look at redundancy as a last resort. It is possible that if you make someone redundant when you could have kept them on furlough and retained their role from the end of October, that redundancy will be considered as an unfair dismissal. Redundancy is potentially a fair reason for dismissal, but it has a specific definition in s.139 of the Employment Rights Act 1996.
Reasons include: you’ve ceased the type of business they were employed for, you’ve moved the location of the business, the requirements for the particular work carried out by them or the requirement for the work to be carried out in a particular place has ceased or diminished.
If you fail to show that the reason for dismissal fits the definition of redundancy, it is likely to be an unfair reason for dismissal. Failure to follow a fair procedure and any contractual provisions can also lead to a finding of unfair dismissal and wrongful dismissal. You’ll also have to follow strict consultation procedures if you’re dealing with a collective redundancy or 20 or more employees within a 90 day period.
While there are a few options out there, we understand the pressure that you are under as employers, so please get in touch with our team if you’d like to chat through your options.
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