New furlough guidance ‘has massive implications’ for employers, says leading lawyer

New guidance on the furlough scheme will present issues for employers hoping to retain staff previously identified for redundancy, a leading lawyer believes.

The government produced updated guidance on the Coronavirus Job Retention Scheme on Tuesday, with a number of changes from the previous scheme.

Ami Naru, partner and head of employment at specialist law firm Travlaw, said the key update for employers was a change of wording in relation to the use of the scheme for those serving notice periods.

Naru said the guidance meant the scheme will become more akin to the now withdrawn Job Support Scheme from December 1, with those serving notice needing to be removed and instead be paid their full wages during their notice period.

She argued this “alarming” wording would have “a massive implication” for employers who may have been considering placing employees previously identified for redundancy on furlough.

Naru said: “Alarmingly new wording has been introduced: ‘The government is reviewing whether employers should be eligible to claim for employees serving contractual or statutory notice periods and will change the approach for claim periods starting on or after 1 December 2020, with further guidance to be published in late November’.”

“This has a massive implication for employers, who were considering putting employees back on to the more generous extended CJRS, because if they were thinking of dismissing an employee on grounds of redundancy or otherwise, they must give them notice before December 1.

“After December 1 it will likely mean that if an employer is serving notice, then the employee in question must be taken off the CJRS.”

Naru also identified a number of other changes to the previous scheme, which expired on October 31.

These include the publication from December of the names of companies utilising the scheme, and the removal of a maximum number of employees that firms could place on furlough.

On the publication of company names, she said: “Rather than being a name and shame tactic, I presume this is intended as a further means of auditing as unfortunately there were some instances of employers (not in the travel industry as far as I am aware!) having employees work as normal and yet still claiming CJRS for these employees.”

To read Ami Naru’s assessment of the new guidance in full, click here.


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