COVID-19: What Employers Need to Know Frid riday, 19 Ju June e 2020 CIPD - Employment Law Webinar
Furlough Scheme Update Carl Vincent Girlings Solicitors
COVID-19 What Employers Need to Know: 19 June 2020 Summary 1) A brief history 2) New flexibility 3) Tapering of relief 4) Agreement 5) Annual leave 6) Sickness Absence
COVID-19 What Employers Need to Know: 19 June 2020 ‘Furlough’ • A leave of absence from duty granted especially to a soldier
COVID-19 What Employers Need to Know: 19 June 2020 A Brief History • Announced – 20 March • Start date (back-dated) – 1 March • HMRC Portal opened – 20 April (140,000 applications relating to more than 1m employees received on day 1) • Last date for ‘new’ furlough – 10 June • 8.9 million employees • End date – 31 October
COVID-19 What Employers Need to Know: 19 June 2020 Purpose • ‘Abusive’ claims or claims ‘contrary to the exceptional purpose’ of CJRS • Furlough = employees instructed to cease work by reason of circumstances arising as a result of coronavirus or coronavirus disease • Payments in respect of furloughed employees arising from the health, social and economic emergency in the UK resulting from coronavirus and coronavirus disease
COVID-19 What Employers Need to Know: 19 June 2020 Reimbursement • HMRC reimburse the lower of 80% of salary or £2,500 per month plus Employer NICs & Employer pension contributions
COVID-19 What Employers Need to Know: 19 June 2020 Flexible Furlough • Pre 1 July – ‘cease all work’ • Post 1 July – furloughed staff able to work part time without jeopardizing furlough status • No 3 week minimum period
COVID-19 What Employers Need to Know: 19 June 2020 Tapering • Begins from 1 August
COVID-19 What Employers Need to Know: 19 June 2020 August • Reimbursement of employer NICs and pension contributions stop
COVID-19 What Employers Need to Know: 19 June 2020 September • HMRC contribution falls to lower of 70% of wages or £2,187.50; employer must top up to 80% of wages (subject to the £2,500 cap)
COVID-19 What Employers Need to Know: 19 June 2020 October • HMRC contribution falls to lower of 60% of wages or £1,875; employer must top up to 80% of wages (subject to the £2,500 cap)
COVID-19 What Employers Need to Know: 19 June 2020 Consent • Must be agreement on furlough • Specify main terms • In writing or • Confirmed in writing by the employer • Keep record until 30 June 2025 • Update to reflect any post 1 July changes
COVID-19 What Employers Need to Know: 19 June 2020 Annual Leave • Holiday accrues • Can be taken during furlough • Normal remuneration • Timing - Reg 15 WTR • Carry over (4 weeks)
COVID-19 What Employers Need to Know: 19 June 2020 Sickness Absence • Relationship with SSP • Long term sickness • Shielding employees
COVID-19 What Employers Need to Know: 19 June 2020 Conclusions • Generous scheme • Well conceived • Well executed • But what next?
Redundancy and Furlough David Morgan Girlings Solicitors
COVID-19 What Employers Need to Know: 19 June 2020 Issues • How does the CJRS impact redundancy dismissals? • How does furlough affect redundancy procedures? • Pitfalls and practical advice
COVID-19 What Employers Need to Know: 19 June 2020 Can I make furloughed employees redundant? Early stated aim of CJRS was “to avoid redundancies” This was revised – now: “The scheme is designed to help employers whose operations have been severely affected by coronavirus (COVID-19) to retain their employees and protect the UK economy .”
COVID-19 What Employers Need to Know: 19 June 2020 Can I make furloughed employees redundant? • Guidance to Employees: “Your employer can still make you redundant while you’re on furlough or afterwards.” • But little explicit government guidance on redundancies
COVID-19 What Employers Need to Know: 19 June 2020 Does furlough change the law relating to redundancy? • No – the contract of employment is unaffected except with regards to the agreed terms of furlough leave • An employee’s statutory rights are unaffected • The law relating to redundancy remains in full force and is unamended
COVID-19 What Employers Need to Know: 19 June 2020 Does furlough change the law relating to redundancy? • Still need to meet the definition of redundancy (s139 Employment Rights Act 1996) • Cessation of business • Reduced need for work of a particular kind
COVID-19 What Employers Need to Know: 19 June 2020 Does furlough change the law relating to redundancy? • Still need to meet the requirements of a fair dismissal under s98 Employment Rights Act 1996 • The determination of whether a dismissal is fair will still depend on whether the employer acted reasonably in treating it as fair reason for dismissal
COVID-19 What Employers Need to Know: 19 June 2020 Does furlough change the law relating to redundancy? • Still need to use a fair procedure • Informing and consulting employees regarding the redundancy proposal is fundamental to a fair procedure • Employers need to consider how to conduct a fair procedure while employees are furloughed
COVID-19 What Employers Need to Know: 19 June 2020 Furlough and Collective Consultation • Where it is proposed that 20 or more employees are dismissed with a 90 day period then the Trade Union and Labour Relations (Consolidation) Act 1992 is engaged.
COVID-19 What Employers Need to Know: 19 June 2020 Furlough and Collective Consultation • Employers must: • Facilitate the nomination and election of employee representatives • Collectively consult with those reps for a minimum of 30 or 45 days • Provide the reps with access to employees
COVID-19 What Employers Need to Know: 19 June 2020 Furlough and Collective Consultation • Consultation can take place during furlough • It is explicit within the guidance that employees can undertake representative duties for the purposes of individual or collective consultation while furloughed • NO explicit confirmation that employees can be consulted – this is implied from the fact that they can be made redundant
COVID-19 What Employers Need to Know: 19 June 2020 Furlough and Collective Consultation • The traditional model of redundancy consultation with face to face meetings, paper ballots and group meetings between representatives and their constituents may not be possible where employees are furloughed or are self-isolating
COVID-19 What Employers Need to Know: 19 June 2020 Furlough and Collective Consultation • Points to consider (1) • How to communicate the proposed redundancy to employees who are on furlough and alternatives to a face to face meeting • How to facilitate the nomination and election of reps where employees are furloughed
COVID-19 What Employers Need to Know: 19 June 2020 Furlough and Collective Consultation • Points to consider (2) • How to hold meetings with elected reps given the requirements of social distancing • Is face to face possible or will online meetings take place? • Do reps have the necessary IT access and knowledge? • How to provide access for reps to the employees they represent • Will employees consent to contact details being shared?
COVID-19 What Employers Need to Know: 19 June 2020 Furlough and Collective Consultation • Points to consider (3) • How are selection pools and criteria impacted by furlough • Take care to identify selection pools • Simply identifying furloughed employees as at risk may lead to unfairness and/or potential discrimination • Take care with selection criteria and the assessment period
COVID-19 What Employers Need to Know: 19 June 2020 Individual Consultation and furlough Similar issues arise for the individual consultation process Remember the right to be accompanied and the need to make provision for a companion and a note taker at any meeting, whether face to face or online
COVID-19 What Employers Need to Know: 19 June 2020 Should dismissal be delayed to the end of the CJRS? • This may not result in an unfair dismissal but it is something an employer should consider, particularly if it is put forward by the employee in consultation • The employer may have a good reason for rejecting such a proposal, particularly given the increased costs of the furlough scheme over the coming months • But consulting about how the consequences of the redundancy can be mitigated forms part of a fair procedure, so employers should give this careful consideration
COVID-19 What Employers Need to Know: 19 June 2020 Furlough and Notice Pay • No government guidance as to the rate at which notice pay should be paid • Employees with a statutory entitlement to notice or a contractual entitlement which is no more than a week longer than the statutory entitlement are entitled to “a week’s pay” for each week of notice (s87(4) ERA 1996)
COVID-19 What Employers Need to Know: 19 June 2020 Furlough and Notice Pay • Where employees have normal working hours this will be a “sum not less than the amount of remuneration of that part of their normal working hours” (S88(1) ERA 1996)
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