Furlough Scheme – The Current Position

The furlough scheme was initially introduced in March 2020. Since then, several changes have been made to the scheme:

Flexible and Full-Time Furlough

In July 2020, the Government introduced ‘flexible furlough’ and this is still an option for employers to consider. This means that employees can work part-time hours and for the hours not worked, they will receive a furlough grant. There is no need for an employee to have been furloughed before, but they must have been on the Company’s payroll on or before 30th October 2020.

Whilst flexible furlough is an option, if your Company simply does not have the work available then full-time furlough is still available.

If you wish to place an employee on furlough then you will need a written agreement in place with the employee to reflect the terms of the agreement. Our employment law experts can draft bespoke agreements for you, simply contact us on 0115 870 0150 for further details.

Furlough Scheme Extension

In December 2020, the Chancellor announced that the scheme would be extended until 30th April 2021. This announcement stirred up another ethical dilemma – Should businesses who made a profit in 2020 repay furlough claims?

The pandemic has hit businesses in different ways; some have thrived, and others have been forced to close their doors for good. So, why should those that have thrived not pay back their furlough claims?

There are valid points for and against – On one hand, we are still amid a global pandemic. No one can say for certain whether a business that did well last year, will be as successful during the third national lockdown. On the other hand, there are the businesses, for example in retail, that need to rely on the furlough scheme now more than ever.

Lockdown 3.0

During the most recent lockdown announcement on 4th January 2021, the Prime Minister imposed last minute changes on school openings. Following the announcement, the HMRC made clear that employers can furlough employees who have caring responsibilities resulting from COVID-19. Caring responsibilities include caring for children who are at home as a result of school and childcare facilities closing. However, any requests from employees do not have to be accepted.

Yesterday, Keir Starmer exclaimed that the Government need to go further to support working parents. He called for a ‘legal, enforceable and immediate right for parents to request paid flexible furlough’ to be created.

The furlough scheme was to be reviewed this January to consider the terms of the scheme and whether the economy has improved enough to ask employers to contribute more. The likelihood of this happening is now low, but we will of course keep you updated on our blog and social media channels. Follow us to stay in the loop!

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