Blog: Miscarriage – a workplace issueThis is not an easy topic to discuss, but an important one nonetheless. Many of you will have also seen recent press coverage following Chrissy Teigen and husband John Legend’s miscarriage. It is a fact that 1 in 4 women experience miscarriage (in medical terms, the loss of a baby at any time before 24 weeks of pregnancy). Unsurprisingly, there are no statistics to show how many women keep their miscarriages a secret (save from their partners or very close family) but it is clear many women never reveal they have had a miscarriage (or miscarriages). With the advent of social media, there are more celebrities willing to share their stories (Jules Oliver, wife of Jamie has recently revealed that she has suffered 5 miscarriages and Chrissy Teigen and husband John Legend shared their miscarriage story earlier this month).  Hopefully such profile discussions will have the effect of ensuring women feel safer sharing this very personal news. Dealing with miscarriage in the workplace Not surprisingly the last place a miscarriage is discussed is in the workplace. Understandably women don’t always want to share such personal information with work colleagues, but it is possibly more nuanced than that. For many women, it will be the case that if the miscarriage happens within the first 12 weeks of pregnancy, they won’t have told work or work colleagues they were pregnant. It’s understandable that in these circumstances a woman won’t wish to tell colleagues she was pregnant but isn’t anymore. More importantly, some women won’t want to inform work that they’ve suffered a miscarriage.  They simply don’t want work (or more specifically their managers) to know that they are trying to have a baby in the first place.  Despite the various statutory protections given to women to ensure that they are not discriminated against because they ‘might’ have children, it is the case that conscious decisions are made every day in the workplace that disadvantage women of ‘child-bearing age’. From an HR perspective, it is a difficult one to manage. You will without doubt have women in your workplace (and, importantly too, partners of women) who have suffered a miscarriage.  Even if you’re unaware, there will still be an effect in the workplace; many women who have miscarriages will not simply ‘bounce back’.  They may start taking unexplained absences from work, or perhaps their performance is not as good as it usually is.  As an employer you may well say ‘how can I help if I don’t know about it?’. Supporting an employee affected by miscarriage and the employment rights to consider Firstly consider your organisation’s culture. If employees don’t feel safe to tell you about a miscarriage, why is that? What role models are there in your organisation of women with children? Is getting pregnant considered a ‘career-ending’ event? Second, remember that women have various protections in the workplace relating to pregnancy. The Equality Act 2010 protects women if they are treated unfavourably because of the pregnancy, or because of illness suffered as a result of it. Tribunals will give broad interpretation to what constitutes ‘a reason connected with pregnancy’ and will include absence caused by pregnancy-related illness. Where a woman needs to take sickness absence following a miscarriage, this should properly be recorded as ‘pregnancy-related absence’ and therefore should NOT be used when considering absence for such things as access to sick pay, redundancy selection, promotion, bonuses etc. Many women report that they feel pressured to return to work sooner than they feel able to because of fears of how their absence will be treated by their employer. Managers need to be aware that knowledge of someone’s miscarriage should not be used detrimentally against them when making decisions about their employment. A manager may think they are being kind to a female employee by not giving them a promotion ‘because they need time to recover from a miscarriage’, but this would amount to direct discrimination and any motives, whilst kindly meant, will not justify the treatment. Separately (and in my mind a bit confusingly), women have a right not to dismissed where the principal reason for the dismissal is their pregnancy. The ‘reason’ will be given a wide interpretation here, and therefore if someone is dismissed because they have taken a lot of time off following miscarriages, this could amount to an automatic unfair dismissal (which is a ‘day 1 right’ and not one requiring 2 years’ service). Can an employee take maternity leave if they suffer a miscarriage? Whilst it is doubtful that a woman would want to take a full period of maternity leave in these circumstances, she might wish to avail herself of some of the protections that maternity leave can bring (time off work which is not counted as sickness absence, maternity pay with the right to come back to her job). Certainly, if the miscarriage happens nearer the 24 week period and the employee has given her statutory maternity notification to her employer of her ‘expected week of confinement’ and her intention to take maternity, there is no reason why she cannot take a shorter period of maternity leave if she choses to do so. I am not aware of this actually happening, but it appears to be a possibility. Maternity leave and pay is specifically available to women who suffer a stillbirth because it amounts to childbirth which is ‘the birth of a living child, or the birth of a child whether living or dead after 24 weeks of pregnancy’. Being miscarriage-aware As with other ‘life’ issues for employees (for example, menopause), how an employer responds to an employee’s personal situation can turn an average employer into a great one. If you want to be in the ‘great’ employer category, you can start by making your organisation more miscarriage-aware. The Miscarriage Association have recently produced a fantastic information pack with loads of helpful detail and even a miscarriage policy: https://www.miscarriageassociation.org.uk/information/miscarriage-and-the-workplace/  It is well worth a look and also reminds employers that there are many people affected by miscarriage – including the often over-looked partner.  I was going to try to not mention COVID here – but, in these strange times, becoming a kinder workplace seems like a no-brainer. If you would like to discuss any aspect of this blog, please contact us on 0117 325 0526 or email Anne-Marie:  Anne-Marie Boyle Partner  ... Read more...

September 2020 NewsletterCongratulations, you’ve made it to September!  Many of us feel a milestone has been reached, whether that is a child-free home at last or a full or part return to the office.  So, put the kettle on and pat yourself on the back as you browse this month’s Newsletter for the latest employment law developments and maybe chuckle at this one we saw recently: “Dear September, I don’t want any trouble from you.  Just come in, sit down, don’t touch anything and keep your mouth shut.”   In this issue you can expect an update on the resurrection of the cap on public sector exit payments, further details on statutory payments for furloughed employees and the Job Retention Bonus scheme, the newly create Kickstart scheme,  self-isolation guidance for those returning from abroad and updated HR1 form for collective redundancies. In our case update, we focus on three unfair dismissal cases which respectively look  at ‘vanishing’ dismissals following successful appeals, a personality clash ending in a fair dismissal with no procedure, and dismissal relying on anonymous witness evidence. We also share with you (in our ‘nothing about employment law bit’ at the end of the Newsletter) a very well thought-through blog from friend of Menzies Law and business psychologist Caroline Gourlay.  Now we know that working fully or partly from home will be with us for the long-term, Caroline offers some very practical tips for navigating work/life balance. What we’ve been doing recently… After a rather busy 5 months, most of the team managed a short break during August and we’re now back and ready to tackle whatever employment law conundrums you throw at us.  We’ve certainly seen a big increase in redundancies and restructures and a real rise in enquiries to Tamsin James (who specialises in advising individuals) from people questioning the fairness, objectivity or procedure (or all three) of their respective redundancies.  A sharp rise in claims is almost guaranteed (as mentioned previously). Anne-Marie is busy preparing for our joint webinar on 15th Sept. She’ll join flexible working specialists Flexology, and culture & employee engagement experts Peopletopia, helping employers prepare for the array of changes they can anticipate in their workplaces.  There are still places available if you’d like to join the conversation: https://www.eventbrite.co.uk/e/return-to-work-webinar-registration-116867121707 Speaking of webinars, we’re continuing to plan for our next online events to replace our usual face-to-face Employment Law update.  Dates and full content will be ready to share with you soon.  As always, if there is a subject you are keen to hear about, please do tell Lindsey ().  On our list so far are: The changing face of the Workplace – how has Covid changed our concept of work and what does that mean for employers? Employment law – getting you ready for 2021. What’s on the horizon, things you may have missed, key themes we’re anticipating, cases from 2020 so far. Pay & Reward – what impacts are businesses likely to see in the age of Covid plus Pay & Reward Surgery. Bring your Questions to our guru, Jane Baalam. Home and flexible working are now in the spotlight. What do employers need to think about? What does it mean for your culture and communication? Business Immigration – how are things going to change as of 1 Jan 2021 for bringing in employees from overseas?   Here are all of the items we cover this month: Government Reforms (1): Public sector exit payments – CAPS LOCK ON… The Government’s new Kickstarter Scheme Coronavirus (Covid-19) – All things furlough (again!) Coronavirus (Covid-19): Beyond furlough – Job retention bonus scheme Coronavirus (Covid-19): Returning from abroad – self isolation guidance Collective redundancy: Government guidance and HR1 form Case update (1): Unfair dismissal – The ‘Vanishing dismissal’ Case update (2): Unfair dismissal – Personality clash S.O.S.R. dismissal Case update (3): Unfair dismissal – Anonymous witnesses   And finally our ‘nothing to do with employment law’ bit With increased home and remote working likely to be with us for the duration, Caroline Gourlay shares some tips in her blog to help you with that elusive work-life balance.... Read more...

Blog: Life after furlough – employment law considerations for cost-effective alternatives to redundancyThe length of time the economy has had to shut down as a result of Covid-19 means that businesses are facing tough cost-cutting decisions.   As redundancies are neither cheap nor easy, the alternatives to achieve savings yet retain skilled staff are very much worth examining.  This article looks at some of the options, together with the employment law issues to consider.  This piece compliments our webinar on this topic on Tuesday 23 June (more here if you’re interested: Menzies Law Webinar) Changing employees’ terms and conditions Adjusting employees’ contractual entitlements, such as pay cuts or reducing benefits, can make good savings. It can be surprising how often staff will be willing to agree to pay cuts in order to give a business a fighting chance of remaining solvent. Pay, benefits and hours of work will be contractual terms of employment for your staff and changing them can be legally challenging.  Sometimes making minor changes may be permitted under the contract (if the wording is there to allow it) but will probably not be sufficient for significant changes that will have a notable impact on income. For significant changes you will either need to obtain your employees’ individual consent or, if not forthcoming, taking the ‘nuclear option’ of terminating existing contracts and offering new ones containing the changes needed (so called ‘fire and re-hire’). Either route requires careful handling. If you decide to take the fire and re-hire option, you’ll need to be mindful of the legal pitfalls such as triggering your legal duty to consult and potential unfair dismissal claims.   It will require specialist advice from an employment lawyer, and I’d be happy to help. If you recognise a trade union for any sections of your workforce you have the additional option of using collective bargaining to reach an agreed change to pay and hours.  But bear in mind that this will only cover those roles that are agreed to be within the collective agreement.  Usually management roles will be excluded and so you will have to reach individual agreement with your managers. Pension contributions A reduction to employer pension contributions can look attractive but may still require you to consult with employee representatives.  Special consultation requirements apply to pension schemes.  Also bear in mind the minimum employer pension contribution thresholds set by current pension law. Lay-off and short-time working The Coronavirus Job Retention Scheme (CJRS) has, for many, avoided the need for lay-offs or reducing working weeks.  However, when the scheme ends (30th June at the time of writing), it may be that employers will reconsider these more traditional options. Check your employment contracts to see if you have the power to impose any lay-offs or short-time working.  Very few businesses currently have such terms although they were common until the 1980s.  Without this sort of contractual ‘permission’, you are back to the ‘changing terms and conditions’ section above.  Without your employees’ express and informed consent, you risk claims for unlawful deduction from wages, breach of contract and constructive dismissal if you were to impose a lay-off (temporary suspension without pay due to having no work for the employee to carry out) or short-time working (reducing hours and work and therefore pay). However, looking to the future, it seem worthwhile thinking about adding in a power to lay-off and short-time working for new starters.  It would be good to be better prepared if we ever face a similar sort of crisis. Reducing use of contract workers Dispensing with the services of casual workers, agency workers and/or self-employed consultants may well reduce your costs, but do make sure none of them qualify as ‘employees’.  If they do, they will have statutory redundancy pay and you might fall foul of unfair dismissal law.  This risk can sometimes be hidden and it is well worth a few minutes with a friendly employment lawyer to ensure you are in the clear. Also check any fixed-term contracts to ensure there is a ‘break’ clause allowing you to make an early termination.  If not, you could be liable to make payments to the worker until the end of the fixed term. Non-contractual benefits Non-contractual (‘discretionary’) benefits are easier to reduce/remove in hard times. Employees would probably rather lose these benefits or have them reduced , rather than face a reduction in salary or hours or losing their jobs, so this definitely an option to consider early on. Other options Redeployment, secondment and sabbaticals may also be on your list.   Redeployments or secondments need your employee’s consent (unless there is an express right to do so in the contract of employment.)  A sabbatical or career-break is simply time away from work and some employees can afford some time off.  Continuity of employment is preserved during a sabbatical and usually annual leave entitlement will continue accrue, which is a cost to bear in mind. Flexible working Part-time working or job-sharing can help reduce costs.  Seek consent here and set out the new ‘regime’ in writing.   Remote, home or flexible working all reduce overheads but be aware of our advice above on changing terms and conditions.  Also consider important issues such data security and health & safety. Communication, communication, communication! With any changes, engaging with your workforce will be key to getting buy-in. In our experience, open communication goes a long way to getting consent to changes, and obtaining their consent reduces your legal risk to almost nil. And lastly, if you need encouragement that a non-redundancy solution is possible, this is a great story of one manufacturing technology company’s successful approach.   Anne-Marie Boyle Menzies Law Anne-Marie Boyle is a Partner at Menzies Law, a boutique employment law firm.  We’ve been advising businesses through difficult times for over two decades and have plentiful experience guiding businesses through making these types of changes.  Please get in touch if we can help:  0117 325 0526 ⃒ ⃒ www.menzieslaw.co.uk  ... Read more...

Updates to Coronavirus Job Retention SchemeOur Menzies Law Guide to All Things Furlough went out to you on Thursday with the caveat that Government guidelines on furlough were changing rapidly.  Just to prove it, the Government has today updated (or clarified) some aspects of its Coronavirus Job Retention Scheme (CJRS) as follows: You can re-hire and furlough anyone CHANGED: (this is a big change)  You can re-hire and furlough anyone who was on your payroll on 28 Feb but then left you, for any reason.  So it’s not restricted to those you made redundant.  So now it could include those you sacked for something else or who resigned. Employees with caring responsibilities CHANGED: Employees who are unable to work because they have caring responsibilities resulting from coronavirus (COVID-19) can be furloughed. For example, employees that need to look after children can be furloughed. Shielding Employees CHANGED (the part in bold): You can claim for furloughed employees who are shielding in line with public health guidance (or need to stay home with someone who is shielding) if they are unable to work from home and you would otherwise have to make them redundant. Definitely no working at all for you while furloughed CLARIFIED: Furloughed workers definitely cannot work for you (or volunteer for you) in any way.  The rules now say that if you have work still to be done (e.g. critical business tasks) then that will have to be done by staff who are not furloughed. Another job while furloughed? CLARIFIED:  Yes, employees can start a new job when on furlough (meaning they might end up earning 80% of the old salary and 100% of a new one).  This was not prohibited in the earlier guidance, but the new guidance expressly allows it.  The guidance does say it has to be allowed under the old employment contract, but presumably the old employer can waive that. Commission pay CLARIFIED: an employer can reclaim 80% of compulsory (presumably meaning contractual) commission back from HMRC, as well as basic salary.  This is good news for car salesmen and estate agents.  But it can only be referring to the commission from past sales as the furloughed employees cannot be completing new sales when on furlough. ‘Fees’ CHANGED: employers can reclaim 80% of fees (whatever that means) from HMRC.  The previous guidance said they could not. Benefits CLARIFIED: the 80% does not include non-monetary benefits (e.g. the value of health insurance or a car). Company Directors CLARIFIED (although we all knew this anyway):  Company directors can be furloughed. They can still perform their statutory duties, but not other work for the company. Re-furloughing or rotating CONFIRMED: Employees can be furloughed multiple times, i.e. they can be furloughed, brought back to work, then re-furloughed (subject to each furlough period being at least three weeks). Written confirmation NEW: Employers must notify employees of their furlough status in writing (the previous guidance did not require it be in writing) and keep the record of that written notification for five years. Still no official news on holiday leave… However, the clever money (i.e. every QC’s blog that we’ve read in recent days) definitely seems to be on the idea of you allowing annual leave to be taken during furlough and paying normal (full) pay for those days, and that this won’t invalidate the furlough.  We’ve also seen a very good argument by leading lawyers that says you probably can’t instruct staff not to take holidays during furlough or to postpone them.   We will continue to update you as things change but if you need help or guidance on a specific issue,  please contact us on 0117 325 0526 /  ... Read more...

The Menzies Law Guide to All things FurloughFAQ’s and what we know so far… By Anne-Marie Boyle and Luke Menzies This is a long blog post and rather more dry than our usual fayre.  But we think you will forgive us, in view of the importance of the topic and our wish to share the following information with you all.  It is hard to imagine that 2 weeks ago hardly any of us had heard of the word ‘furlough’. Now it is part of our everyday language. In this blog we look at what we know so far about this new type of special paid leave and address the common questions that employers are asking about the scheme and its application.  We also sum up the recommendations we’re making to our clients.     Information from the Government is changing all the time – particularly the drip-drip detail we’ve been getting about furlough leave.  So while the information in this blog was accurate at the time of writing, based on the Government’s 26 March 2020 publication of the rules, it is likely to change to some extent, so it’s not a substitute for taking legal advice based on your own circumstances.  Read on below for our current answers to this list of questions.  Or jump down the page to see a specific answer.  (* and please note that clarification and updates to some of these points can now be found here *) Why this Scheme? CJRS – What is it and who can participate? Must we consider furloughing as opposed to redundancies? Which employers are eligible? Which types of staff can we furlough? What about this 28 February cut-off date? What about employees recently made redundant? What costs can employers recover? Benefits NIC and pension contributions Does the employer have to top up the employee’s pay to 100%? What do employers need to do to place someone on furlough? How do I choose who to furlough? Can I impose furlough on someone who is unwilling to agree to it? Can we ask furloughed employees to do any work for us? Can we rotate employees on and off furlough leave? What situations will furlough leave not help with? How will this affect the employment status of employees? Working for others during furlough What about annual leave? What about an employee falling sick during furlough leave? What about employees taking maternity leave or other types of family leave? We are here to help   Why this Scheme? The Government are trying to keep the wheels of the UK economy turning and, vitally, protect jobs by introducing a package of measures to alleviate the impact of COVID-19 on businesses across the UK.  Chief amongst these is the Coronavirus Job Retention Scheme (‘CJRS’ for ease). CJRS – What is it and who can participate? The CJRS enables employers to recover up to 80% of wage costs (up to a maximum of £2,500 per month) for employees who agree to be placed on ‘furlough leave’.  This is a new concept and a totally new class of paid leave, where the Government will reimburse the employer for these wage costs. It is a temporary scheme and will currently run from 1 March 2020 for 3 months.  It may be extended if necessary. It has been created to act as an alternative to implementing redundancies, lay-offs, unpaid leave or other measures employers might otherwise need to instigate during the current crisis. After existing as just a few hazy lines on the Government’s website for a few days, the rules (if we can call them that, given how unclear much of their wording is) was updated on 26 March 2020 and is available here. Must we consider furloughing as opposed to redundancies? It is possible that we could see the rise of the argument that a redundancy would be an unfair dismissal if the employer had not considered using furlough prior to making redundancies for staff with 2+ years’ service.  This idea is only speculation at this stage, and would probably take many months to emerge from employment case law, but it is worth factoring in.  It also makes sense on a moral level. Which employers are eligible? The good news is that all UK businesses are eligible to claim under the scheme so long as they operated a PAYE payroll scheme on or before 28 February 2020 and have a UK bank account. Which types of staff can we furlough? The Furlough scheme is available to all PAYE employees (including casual employees and zero-hours employees). Our interpretation of the current CJRS rules (based on the outline published on 26 March 2020) is that ‘workers’ (i.e. those you employ and who you may pay through PAYE but who are not technically your employees – such as casual workers) are not included in the scheme.  This is because the rules are very clear that you have to be an employee in order to be furloughed.   So if you have casual workers under a contract that says they are not employees, they cannot be included. The CJRS will also not be available to any of your self-employed contractors (they have the separate scheme for the self-employed, again recently announced by the Chancellor). With agency workers, the CJRS rules (26 March version) are unhelpfully very unclear in terms of who should place them on furlough and claim their wages.  So long as the agency worker is an employee (working under an employment contract that says they are an employee), the rules say they can be furloughed. However, it is not at all clear whether it is the client/end-user who should furlough them and claim the 80% of wage or the agency itself.  Our view is that, in legal terms, it is the agency who is their employer, and so it has to be the agency who places them on furlough.  The REC (the recruitment agency’s representative body) has issued advice which suggests they agree with this view, but the official CJRS is unhelpfully really unclear and could confuse a lot of employers on this point. What about this 28 February cut-off date? Employees must have been on your payroll by 28 February 2020 in order for you to be able to furlough them.  Therefore anyone hired or starting since 29 February are not covered.  (Ignore any commentary or advice you may have seen that gives the cut-off date as 1 March – this is wrong.) We have been asked about new employees who started in late February but who were not added to the employer’s PAYE system until after 28 February.  This is another example of where the 26 March CJRS rules are confused and really unhelpful. While the rules do indeed say “Furloughed employees must have been on your PAYE payroll on 28 February…” they also go on to say “Employees hired after 28 February cannot be furloughed…”  (Note the confusion between “on your PAYE payroll” and “hired”.)  The second sentence gives the clear implication being that employees hired on or before 28 February therefore can be furloughed. Our advice is that this will hopefully be cleared up soon, when more detailed rules are published.  It would be odd, given the objective behind the policy, for the Government to want to explicitly discriminate between those who had been hired and placed on payroll by 28 February and those who had been hired by 28 February but where the employer had not get got around to adding them to their payroll system. Our view is that where the rules say “must have been on your payroll” they surely mean “must have started in your employment” – and the author has not considered the implications of their inconsistent wording. We suggest that if you have anyone who falls into this uncertain situation who you wish to furlough, you check with us at the time.  If you do try to furlough them, ensure that the furlough agreement only commits you to paying the employee whatever funds you obtain for their pay under the CJRS, and nothing more.  Then your exposure is very limited. What about employees recently made redundant? Employees who have been made redundant since 28 February can be furloughed by their former employer if rehired.   The Government’s idea is apparently that they cannot be furloughed by a new employer but can be by their former employer. There is clearly a question of whether the former employer might feel at risk here in the scenario where the furlough scheme ends and they are ‘left’ with still employing someone who they made redundant a few weeks ago.  If they still have no need for this employee, do they have to make them redundant all over again?  Or could the previous redundancy still count?  If yes, would the employer just be able to tell the employee to leave, or would that be an unfair dismissal?  What sort of dismissal procedure might be required?  If the employee had a few days/weeks less than 2 years’ service at the time of the original redundancy, might they then gain this additional service during furlough and thus become more expensive or risky to dismissal again? There are so many questions here but sadly the CJRS rules do not give us any of the answers.  Going back to normal employment law principles, our best guess here (this week) is that if they had 2+ years’ service at the time of the original redundancy, you could offer to take them on  – after having left 2-3 weeks between the original end date and the re-hire date.  You’ll need this backed up by an express agreement in the furlough agreement that this is a new hire and does not preserve continuity of employment from the previous employment. There are alternatives, and additional things to mention if this is something you are grappling with.  Get in touch if you’d like more specific advice here. What costs can employers recover? The CJRS funds 80% of an employee’s “wage”, up to a cap of £2,500 gross per month per employee. There is no limit on the number of employees or the duration (as yet). For full-time and part-time salaried employees, the employee’s “regular wage” as at 28 February 2020 should be used to calculate the 80% figure.  Fees, commission and bonuses cannot be included. We are not certain what is meant by ‘fees’.  The guidelines are currently silent as to whether pay additions such as shift premia, honoraria and allowances (e.g. car allowance, clothing allowance) come within the definition of “regular wage”.  There is the potential for there to be substantial room for future litigation here, so we recommend that employers only commit under a furlough agreement to pay their furloughed employees whatever money they are granted under the CJRS for that person.  You may wish to avoid committing to paying a certain sum or specific elements of pay and reward only to find that the CJRS will not fully reimburse you. The guidance also covers the application of the national minimum wage (NMW) to furloughed employees. It states that, since employees are only entitled to the NMW while doing work, furloughed employees who are not working must be paid at the 80% rate (or £2,500) even if, based on their usual working hours, this would ordinarily take them below the NMW. However, the guidance goes on to state that if employees are required to, for example, complete online training courses while they are furloughed, then they must be paid at least the NMW for the time spent training, even if this is more than the 80% of their wage that will be subsidised.  The employer must fund any difference. As for employees whose pay varies, if they have been employed for at least a year the employer will be able to claim for the higher of (a) their earnings in the same month the previous year and (b) their average monthly earnings in the 2019/20 tax year. If they have been employed for less than a year, the employer will be able to claim for an average of the employee’s monthly earnings since they started in this job. In the case of an employee who only started in February 2020, the employer will be required to pro-rate the employee’s earnings so far. (It is confusing that here the word “earnings” as opposed to “wage” is used.  We can only assume that the author of the guidelines intended this to mean the same thing, but it again introduces uncertainty.) Benefits The guidelines are largely silent on whether an employer must continue to provide benefits during furlough but it appears likely that the answer is going to be yes, they must be continued unless your furlough agreement specifically agrees that they will not. If an employee wishes to suspend or end their auto-enrolment employee pension contributions during furlough, they will need to ask to opt out, using the normal opt-out rules. NIC and pension contributions Employers can claim the cost of employer’s NIC and employer’s auto-enrolment pension contributions (at the minimum rate) for the 80% of wage cost (but not in respect of any voluntary top-up of pay by the employer). Does the employer have to top up the employee’s pay to 100%? No, but some employers may wish to make up the shortfall. Where an employer cannot do so (and many will not be able to), this should be made clear to all employees concerned. Our recommendation is to be consistent! What do employers need to do to place someone on furlough? First, employers will need to agree which employees they wish designated as ‘furloughed workers’.  An employee cannot insist on being a furloughed worker unilaterally.  It must be by agreement. Since placing someone on furlough represents a variation (albeit a temporary one) to their contract of employment, normal employment law still applies. Therefore, unless you are an employer with a contractual lay-off clause in your employees’ contract of employment, employers still need to consult with staff with a view to seeking their agreement before placing them on furlough leave. We recommend that employers put in place a clear written furlough agreement with each furloughed employee.  We have been putting together many furlough letters and agreements over the last week. We’ve rapidly developed a lot of knowledge of furloughing, so please contact us if you need some help.     How do I choose who to furlough? In your organisation there are likely to be some employees who are continuing to work, receiving either full or reduced pay, while others will be on furlough leave, getting paid at least 80% for effectively doing nothing.  It is likely that this may cause some resentment (hence why we suggest you consider rotating furlough leave).  It is important to listen to employees’ concerns here. We do not agree with comments we have read elsewhere that employers should undertake formal selection or consultation processes for deciding who to furlough, as you would with a redundancy exercise.  However, like a redundancy exercise, the employer should focus on which roles it does not currently need, and which can therefore be furloughed, rather than thinking of which people it wishes to furlough.  These decisions should be operational and structural, not personal.  And of course, the employer’s request for an employee to agree to go on furlough, and the employee’s consent, is effectively a mini-consultation exercise. Those who are off sick because they are either ill or self-isolating may only be getting statutory sick pay (SSP).  As this is approximately only £95 per week in most cases, it is unlikely to be as much as 80% of full pay.  However, the 26 March guidelines are clear that you are not able to furlough someone who is off sick or self-isolating unless you also no longer require their job to be performed. The one exception to this is those who are self-isolating at home because they are ‘shielding’ under the Government’s shielding advice for those who are at very high risk from COVID-19.  For this small group, their employer is allowed to place them on furlough (with their agreement) even if their role still needs to be performed. Can I impose furlough on someone who is unwilling to agree to it? No.  Placing someone on furlough requires their willing consent and an employer cannot force it on them. In many cases, the employer will inform staff of the difficult financial situation that the organisation finds itself in and will hope that this is enough, along with the benefits that come with being paid while not having to work, for most employees to be willing to agree to go on furlough. Where any employees are reluctant to agree, the leverage that an employer may have to persuade them will depend on the situation that the particular organisation finds itself in.  If the employees’ contracts contain a power for the employer to temporarily lay them off without pay, a threat of lay-off as the alternative will normally be enough.  But for the vast majority of employers, who do not have this option, there may well be far less leverage. The obvious ‘threat’ is to make employees redundant, but this of course comes with an additional cost and may not be viable.  Failing that, it may simply be a case of reminding the employees that the organisation may become insolvent if staff aren’t willing to co-operate. There is no reason why an employer cannot promise to pay a post-furlough bonus of some type at some point in the future as an incentive to agreeing to be furloughed now (perhaps related in some way to the loss in pay that higher earners may suffer when on furlough). Can we ask furloughed employees to do any work for us? No.  An employee is considered furloughed for the purpose of this scheme only if they do no work for the employer.  The scheme therefore does not cover the wages of employees whose hours and pay are reduced but who keep on working at a reduced level. While the earliest description of CJRS suggested that employees may still be able to perform some tasks for their employer if it was not something that produced any value for the business, the 26 March guidelines have changed tack, stating that “when on furlough an employee can not undertake work for, or on behalf of, the organisation.  This includes providing services or generating revenue.”   We believe that this is very clearly saying that a furloughed worker cannot do any work whatsoever for the employer.  We do not believe that asking employees to “volunteer” to perform work for the employer will be acceptable. Therefore if you wish to retain some staff to continue to do essential tasks such as maintaining site security, manning your phones or maintaining any equipment or IT systems, they cannot be furloughed.  We would advise you not to take risks here by seeking to hide such work. The rules do say that furloughed employees “can take part in volunteer work”.  However, we do not interpret this as permitting employees to voluntarily do work for their employer.  It seems likely that this is a reference to voluntary work outside of the employer’s organisation, such as volunteering with the Government’s NHS volunteering scheme. Can we rotate employees on and off furlough leave? This question may well come up during consultation and our advice is that it could be unreasonable not to consider whether this might be possible. At present, there appears to be nothing to prevent employers taking employees on and off furlough leave – as long as each period of furlough leave is at least 3 weeks long.  Some staff (particularly those with children at home) may welcome being furloughed even if it is on a reduced salary. Others will need to maintain their salary, if at all possible. What situations will furlough leave not help with? Furlough leave is to protect the jobs of employees who would have otherwise been laid off or made redundant due to the impact of coronavirus on the employer’s business.   It does not help with any situations where employees had agreed to reduce their hours, or to take a pay cut but where they are still required to work in some capacity. There is currently no option to combine reduced hours with furlough leave. In our experience, many businesses who still have a flow of work are looking at reduced hours/pay at this stage. Furlough leave may still need to be used further down the line. Furlough also cannot be used for those who are self-isolating at home or staying home to look after children unless their employer also does not have any work for them to perform. How will this affect the employment status of employees? The employees concerned will remain on the employer’s payroll and will continue to accrue holiday and service as usual. During the furlough leave, the employee’s employment contract remains in place in other respects, such as important terms covering confidentiality, intellectual property rights, not working for others without permission and restrictive covenants.  You may wish to remind them of this. Working for others during furlough If a furloughed employee already works (with your permission) for another organisation in addition to yours, being furloughed by you does not prevent them from continuing to work for that other organisation – or even being furloughed by them too.  It seems clear that the spirit of the CJRS is that HMRC would frown upon such an employee increasing their working hours for that second employer but this is not currently prohibited. As the scheme is being administered by HMRC and employers have to give the names of the employees being ‘furloughed’, it is likely that any employee who takes new separate paid work during furlough leave will be identified (eventually!). Our guess is that HMRC might then reclaim payments made to the (first) employer. Therefore, it is important that your furloughed employees understand that they cannot undertake work elsewhere during the furlough period during the hours when they normally work for you. What about annual leave? We don’t have any clear answers on this topic yet! Is the taking of annual leave during furlough leave possible or allowed?  If you pay an employee for a day of holiday, might that render their furlough period void? It feels like it would make sense, particularly if you are ‘topping’ up the salary of furloughed employees to 100%, to require employees on furlough to take their accrued annual leave during any furlough period.  And with the Easter bank holidays coming up, what will happen then?  For those employers who cannot afford to ‘top up’, can you insist on employees taking their accrued holiday during furlough if it is not at the proper rate of holiday pay laid down by law?  Would you pay at 80% or at the employees’ full salary? We don’t yet know the answers to any of these questions.  It is a measure of the uncertainties here that within our team at Menzies Law we can find no consensus on what the ‘safer’ advice is to give you here!  Is it to allow holiday to be taken, or to say it cannot?  We just don’t know. Since the Easter bank holidays are fast approaching, we are hoping for some Government guidance on this issue very soon. What about an employee falling sick during furlough leave? The CJRS rules are not yet clear about whether it is possible to take sick leave during furlough leave.  It may be that once you are on furlough leave, sick leave is not possible. If we are wrong about that, we anticipate that most employees would fail to notify their employer if they became sick (or need to self-isolate) during furlough leave because of the adverse pay consequences of doing so if it meant going onto SSP. What about employees taking maternity leave or other types of family leave? These ‘family friendly’ leaves are still available and for some people it will make sense for these to continue (particularly with the special protections that are available to employees taking these types of leave). However, for an employee on maternity leave who is nearing the end of her leave and is currently in a period of nil pay, she may wish to ask to end her maternity leave and be furloughed instead. There doesn’t seem to be anything to prevent this happening, so long as the employer does not currently have any work for her to perform. We are here to help We are coming across new scenarios, new information and new questions regarding furlough leave every day.  We are very happy to help guide you through what is undoubtedly becoming one of biggest challenges we have ever seen in employment law. While the rules on CJRS are currently evolving on an almost daily basis, and some of the elements of it are subtly shifting, we are here to help you keep up to date. Please contact us on 0117 325 0526 / Anne-Marie Boyle & Luke Menzies, Menzies Law... Read more...