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Furloughing employees – update on COVID-19 job retention scheme | #employeefraud | #recruitment | #corporatesecurity | #businesssecurity | #


Introduction

The government has again updated its guidance on how furlough will work in practice under the Coronavirus Job Retention Scheme.(1)

On 17 April 2020 the government issued further updates to its guidance for employers on claiming for employee wages through the new Coronavirus Job Retention Scheme, and separate guidance for employees. (The guidance was originally published on 26 March 2020 and had previously been updated on 4 April 2020, 9 April 2020 and 15 April 2020.)

Alongside this, on 17 April 2020 the government published separate information for employers in advance of the online portal opening for claims on 20 April 2020, including:

The latest guidance follows the publication by the chancellor on 15 April 2020 of a Treasury direction under the Coronavirus Act 2020, which sets out the legal framework for the scheme.

Key points from latest guidance

The most recent update deals with the requirements for evidencing employee agreement to furlough, following concerns created by the Treasury direction on this issue. The Treasury direction stated that furlough must have been agreed in writing between the employer and employee (including by email). This wording provoked concern among the large numbers of employers that had not required furloughed employees to sign any kind of agreement or provide a written response. The latest guidance offers some reassurance on this point, indicating that implied agreement will be sufficient for the purposes of the scheme, and that there must be a written record but that the employee need not provide a written response.

The position relating to sick leave and furlough remains unclear. The updated guidance still states that sick employees can be furloughed, so there continues to be an inconsistency with the Treasury direction, which indicates that it is impossible to put someone on furlough until their statutory sick pay has ended.

Employers finally have some certainty on holidays. The updated guidance confirms that employees can be furloughed and on holiday at the same time. The guidance states that payment for statutory annual leave should be paid at the employee’s usual holiday pay rate, requiring a top-up from the employer which cannot be recovered under the furlough scheme.

The latest guidance explains that employees and the public will be able to report suspected fraud through an online portal and warns employers that payments may be withheld in full or need to be repaid if the claim is based on dishonest or inaccurate information or found to be fraudulent. The guidance also adds that dishonest or deliberately fraudulent claims put essential public services and the protection of livelihoods at risk during these challenging times.

Endnotes

(1) A comprehensive FAQ for employers on the Coronavirus Job Retention Scheme is available here.



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