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Laura Bowyer

Furlough Q&A

Can employees who elected to take unpaid leave to be able to look after their children home from school or nursery be put on furlough leave instead?


This depends upon whether HMRC imposes specific conditions on the circumstances in which employers can claim reimbursement of wages paid during furlough leave. For example, if there is a requirement that the reimbursement will only be made where the furlough leave was agreed as an alternative to redundancy (which appears to be the intention) then this type of situation may not qualify unless they were genuinely at risk of redundancy. If further detail clarifies that there are no specific qualifying requirements for furlough leave, employees on unpaid leave could be put on to furlough leave if they agree to a temporary contractual variation in pay.


What is ‘shielding’ and ‘vulnerable’?


The guidance https://www.gov.uk/government/publications/guidance-on-shielding-andprotecting- extremely-vulnerable-persons-from-covid-19/guidance-on-shielding-and-protectingextremely- vulnerable-persons-from-covid-19 says that employees who are shielding themselves in line with public health guidance can be placed on furlough. This means employees who are extremely vulnerable (ie, organ transplants, lung cancer, severe chest conditions or immunosuppressed conditions) and who have been notified (usually by letter) by the NHS to isolate for 12 weeks.


Details of vulnerable people: https://www.gov.uk/government/publications/covid-19-guidance-on-social-distancing-and-for-vulnerablepeople/ guidance-on-social-distancing-for-everyone-in-the-uk-and-protecting-older-people-andvulnerable- adults


How does an employer decide who to put onto furlough leave: do they need to go through an equivalent redundancy scoring exercise?


An employer could initially ask for volunteers. However, in some cases an employer may receive more volunteers than it wants to furlough. The procedure an employer follows to decide which employees to furlough may depend on its current financial situation. If the employer needs to very urgently furlough employees or make them redundant in order to be able to continue to trade, a limited selection procedure, carried out on an urgent basis, is likely to be acceptable. However, where an employer does not have any immediate financial concerns, it is likely to be more reasonable for it to follow a more comprehensive procedure. Employers could draw up a matrix of objective criteria in a similar way to redundancy scoring. Employers should ensure that their decisions on who to select for furlough leave are not based on discriminatory criteria, except where such discrimination is likely to be justified. For example, it will be directly discriminatory for employers to use age as a criteria and select employees over 70. However, this could be justified as a proportionate means of achieving the legitimate aim of protecting the health and safety of vulnerable employees as identified in government guidance.


Can an employer rotate furlough leave between its employees?


The new guidance states that employees must be furloughed for a minimum of three weeks. This is in keeping with the current requirements for as many people to avoid leaving their homes as much as possible. However, since employers are likely to receive many requests or volunteers to be placed on furlough leave, it is likely to assist employee relations for employers to be able to move employees on and off furlough leave, subject to that minimum three week period, so that no employee feels that they have been unfairly denied the opportunity to take furlough leave.


Can a Director claim furlough?


During a Daily Coronavirus webinar hosted by the CBI on 27 March 2020, Ben Kerry, Head of Labour Markets, HM treasury said there is evidence to show that directors might qualify. However, where a director/shareholder takes a low salary which is topped up by dividends, only the PAYE salary element is covered by CJRS. If there are a number of directors, some may be furloughed with a continuing director. If a director is furloughed, they must not work and only carry out statutory duties ie, annual return.


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