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CJRS – 30th April – Taking Stock – Holidays, Bank Holidays, Furlough Notification and Furlough Fraud


Changes last made to the Employer’s guidance on 23rd April have  been in place and unchanged for a whole week, the portal has been up and running for 10 days and, as promised, employers are already receiving cash back from the government to cover furlough wages in accordance with the scheme.

Further to our previous major update on 17th April (scroll down for that) we are now able to confirm:


Holidays can be taken on furlough leave and employers are able to claim back 80% of the employee’s normal wages through the scheme while the employee remains furloughed and is on holiday. Employers can  require employees to take some holiday during furlough but:

a) this requirement shouldn’t be unreasonably exerted (we suggest that employees are not required to take more holiday than they have already booked to take and/or actually accrue while on furlough leave); and

b) if employers require employees to take some holiday they will need to give twice the notice as the holiday required (e.g 2 days notice for 1 day holiday); and

c) employers will need to pay full contractual pay for the holiday days but will only be able to reclaim 80% for those days designated as holiday (and the usual monthly cap of £2,500 continues to apply); and

d) if the objective is to ensure employees don’t return e.g. in July with loads of accrued holidays to take before the end of the year, employers should remember that new emergency legislation enables 4 weeks of holiday to be rolled forwards into the next 2 holiday years – it might be better from a cash flow perspective to let employees keep holidays and spread them over future holiday years instead.

Bank holidays

The same applies to taking bank holidays as holidays on furlough leave and if employees would have normally taken the Easter and forthcoming May bank holidays as a part of their paid holiday entitlement these days can be classed as holiday too, providing the employer pays the balance up to their normal contractual days.


Earlier confusion over whether furlough needs to be agreed in writing with employees or simply notified to them has now settled – notification is fine provided employment laws are otherwise respected. Employment laws will be respected if:

a) the employer had a contractual right to lay off employees on reduced or no pay (and then notified them of the need to go on furlough leave); or

b) the employer agreed with the employee that they should go on furlough leave under CJRS conditions and have a record of this agreement; or

c) the employer told the employee to go on furlough leave under CJRS conditions and the employee complied willingly (known as ‘deemed acceptance.’)

Employers must however keep a written record of the furlough notification/agreement for 5 years.

We suggest that notification of unfurloughing is also kept for a similar period to show clear evidence of when leave ended.


It is inevitable that some employers will be tempted to make use of the scheme when they shouldn’t – in the main this will be employers furloughing employees and then requiring them to continue working. An easy fraud reporting mechanism has been established and this is already very much in use.

Partial unfurlouging

There is a great deal of speculation in the press that employees may be able to make a gradual return to work, perhaps a couple of days per week with CJRS furlough pay applying the remainder of the week spent on furlough. While this is happening in some European countries, it is only speculation here in the UK. As the guidance currently stands for employers to be able to claim the CJRS wages grant, employees must do no work for a minimum of 3 consecutive weeks and then no work at all while they remain on furlough leave.



Despite problems reported with HMRC’s ‘furlough portal’ employers managed to register 1m staff in the first day of its operation, meaning earlier estimates of up 2m staff being furloughed look wildly short of the mark.

In our 17 April update (scroll down for that) we spoke about whether existing furlough notifications would provide adequate evidence of furloughing for HMRC purposes. These need to be kept for 5 years, but the issue wasn’t so much with that as with the level of ‘agreement’ required – a Treasury Directive seen on the 17th required written agreement, a higher evidential hurdle than ‘notification’ of furlough.

As eagle eyed employment barrister Daniel Barnett has pointed out there have been 2 subsequent updates since that Directive was issued and, thankfully, neither increased the burden of proof from ‘notification.’ The guidance also requires that furloughing in each case must be in accordance with the employee’s contract and employment law. This brings us full circle to our original advice back in March when we suggested that employers who have a contractual right to lay off workers on reduced or no pay need only notify their workers of the requirement to go on furlough, and employers who had no such contractual right needed to get agreement, which we correctly predicted wouldn’t be hard to get.

Some employers without the lay off clause to rely on, and particularly with larger work forces, have opted for ‘deemed acceptance’, i.e. requiring their employees to furlough from X date, or to contact them by Y date to express their objection. If employees complied and furloughed, their acceptance would be deemed to be in place.  This is a step back from express agreement but given that the now 6 times updated .gov advice requires only notification to access the grant, it has proved a successful and administratively minimal strategy for many.

Whilst its easy to be critical of the chopping and changing we should remember that most laws take months, years to reach implementation stage – the CJRS appeared in a couple of weeks and so it’s pretty unsurprising that legislators are making changes on the hoof, so to speak.


Just in case anyone has missed it, the CJRS portal is now open.

Employers can now start registering their employees in order to claim the wages rebate, although our early indications are that it is not entirely reliable.


*****CJRS Scheme to be extended to end of June******

Aside from the extension of the CJRS scheme to the end of June, two other updates appeared Friday eve, the first  hopefully diffuses Friday’s potential bombshell that could have rendered all existing furlough letters as null and void; the second was some long awaited (but alas still very incomplete) guidance on holidays which appeared on the .gov employee’s guidance (but hasn’t  appeared on the employer’s guidance yet (or at least it hadn’t by Sunday 19th April at 5pm when I wrote this article…)

Starting with the second point holiday leave, we now have the following guidance:

Holiday pay (from employee’s guidance on .gov)

Whilst furloughed you will continue to accrue leave as per your employment contract. You can agree with your employer to vary holiday pay entitlement as part of the furlough agreement, however almost all workers are entitled to 5.6 weeks of statutory paid annual leave each year which they cannot go below.

You can take holiday whilst on furlough. Working Time Regulations (WTR) require holiday pay to be paid at your normal rate of pay or, where your rate of pay varies, calculated on the basis of the average pay you received in the previous 52 working weeks. Therefore, if you take holiday while on furlough, your employer should pay you your usual holiday pay in accordance with the WTR. Employers will be obliged to pay the additional amounts over the grant, though will have the flexibility to restrict when leave can be taken if there is a business need. This applies for both the furlough period and the recovery period.

If you usually work bank holidays then your employer can agree that this is included in the grant payment. If you usually take the bank holiday as leave then your employer would either have to top up your pay to your usual holiday pay, or give you a day of holiday in lieu.

During this unprecedented time, we are keeping the policy on holiday pay during furlough under review.

There are 3 implications I can see from this, and some of these apply to the bank hols just gone. The 3 implications

  1. If holidays are possible on furlough as the guidance says, then It looks like employers can require employees to take holiday during furlough, but you’ll need to pay that at 100% of normal pay.
  2. It looks like, although it doesn’t actually specifically say that but i think it means that employers will be able to claim back 80% of the holiday cost up to the usual monthly cap of 2500, but will have to pay the remaining balance to the employee plus employers pension and employers NI on the balance.
  3. It looks like the bank holidays just gone can be regarded as holiday if the employee would normally have taken them as holidays, but applying 1) and 2) and the employee’s guidance from .gov above, employers will need to pay the normal salary for bank holidays.


It’s worth noting that while employers can require employees to take holiday they do need to give double the notice than the holiday required – so if employees didn’t normally work a bank holiday it will not be possible to retrospectively apply holiday to the Easter holidays. It’s also worth remembering that terms of employment cannot be unreasonably applied – and I would guess that requiring employees to take a lot of their annual holiday during furlough – when they can’t do very much with their holiday – could indeed constitute an unreasonable requirement and a breach of contract in its own right, possibly entitling employees in some circumstances to claim they were constructively dismissed. The watch word as ever is to be reasonable.


Written agreement vs notification

The second major update from Friday evening was on the subject of whether agreement is required for employees to go on furlough, or whether a written notification kept for 5 years would do. If you remember earlier guidance said ‘written notification’ was required, then a Treasury directive was spotted which clearly said that employers would need written agreement from employees to go on furlough, and further that that agreement should contain express confirmation that the employee would do no work for the employer while on furlough. This would have been a major headache for the tens of thousands of employers who have already written furlough letters based on the initial guidance which didn’t require either express agreement or the additional ‘no work’ confirmation.

On Friday things changed in the employer’s guidance this time and these phrases appeared:

Agreeing to furlough employees

Employers should discuss with their staff and make any changes to the employment contract by agreement. When employers are making decisions in relation to the process, including deciding who to offer furlough to, equality and discrimination laws will apply in the usual way.

To be eligible for the grant employers must confirm in writing to their employee confirming that they have been furloughed. If this is done in a way that is consistent with employment law, that consent is valid for the purposes of claiming the CJRS. There needs to be a written record, but the employee does not have to provide a written response. A record of this communication must be kept for five years.

You do not need to place all your employees on furlough. However, those employees who you do place on furlough cannot undertake work for you.

In the following section it also states: “Employers should discuss with their staff and make any changes to the employment contract by agreement. Employers may need to seek legal advice on the process. If sufficient numbers of staff are involved, it may be necessary to engage collective consultation processes to procure agreement to changes to terms of employment.”

That certainly tones down the Treasury directive (and therefore appears at odds with it – greater legal minds than mine say this is still a problem) and lowers the bar somewhat, as arguably once an employee goes on furlough leave and acts in accordance with the employer’s instructions then they can be deemed to have accepted/agreed to the furlough terms. Hypothetically we could imagine an employee later raising a grievance against the furlough terms (or furloughing generally) and claiming they made no such agreement, in which case the employer would have to show that the employee’s conduct at the time (i.e. in going on furlough and accepting furlough pay) entitled it to assume that the employee had agreed.

We can’t see that further changes won’t appear, and in particular around these two topics but for now that brings us up to date, or as far as last Friday 17th April anyway.



15th April, saw further changes to the CJRS. We have brought our earlier posts up to date based on the latest available advice, which continues to remain silent on the topic of holidays during furlough leave. Other uncertainties remain, including whether written notifications of furlough leave will suffice as evidence for HMRC purposes (we’ve seen Treasury directions to HMRC which seem to indicate that a higher hurdle of express agreement is required.) The article below highlights the most recent sets of updates and concludes with a set of Q&As we’ve dealt with from our clients. Older posts will now be deleted and should be disregarded.

15th April updates (highlights)

  • The qualifying dates have moved to 19th March – employers can claim for furloughed employees that were on PAYE payroll on or before 19 March 2020 and were notified to HMRC on an RTI submission on or before 19 March 2020. (this will help employers with very new employees)
  • People no longer now have to be in the ‘otherwise redundant’ category – only that they have no work because of coronavirus
  • Employees made redundant or stopped working between 28 Feb and prior to 19 March who have been made redundant can be re-engaged and furloughed provided they were on PAYE payroll on or before 19 March 2020 and were notified to HMRC on an RTI submission on or before 19 March 2020 (NB…just because you can doesn’t mean you should – please seek advice on your particular circumstances
  • Furloughing must be for a minimum of 3 consecutive weeks, but there is no longer a requirement for the ongoing 3 weekly cycles we assumed to apply – so you can unfurlough at 4 or 5 weeks for example, and claim back the grant for the whole period
  • The requirement to do no work extends to any associated or linked company
  • Employers can only claim 80% of regular salary or wages (to the cap of £2,500 pcm) and past contractual commission – discretionary bonuses, discretionary tips etc. cannot be claimed, neither can non cash benefits through salary sacrifice schemes.
  • Where workers have had multiple employers in the last year only the current employer should furlough them even if other employers would otherwise be eligible to do so.
  • Employers can extend fixed term worker contracts but if a fixed term contract otherwise comes to an end (and isn’t extended) during furlough, furlough grant ceases at the end date.
  • Directors who are furloughed can only fulfill statutory duties – a narrower band of duties than previous guidance, we assume this limits duties to compulsory company house document filing etc.
  • TUPE – employees acquired under TUPE since 19 March can be furloughed (was previously 28 February.)
  • Calculating what to claim – new calculation requires (in the case of regular hours workers) to use 80% of salary in the pay period prior to 19th March, for variable workers use the higher of the same month’s qualifying earnings in the prior year or the P60 average, or for recent joiners use the average since starting.
  • Employers with less than 100 employees will be asked to input employees one by one into the portal, those with more than 100 will need to upload a file – our advice is for larger employers to get working on the spreadsheet now – you will need your employer PAYE reference number, the number of employees being furloughed and their National Insurance Numbers, their names, payroll/employee number (optional), your Self Assessment Unique Taxpayer Reference or Corporation Tax Unique Taxpayer Reference or Company Registration Number, the claim period (start and end date), the amount claimed (per the minimum length of furloughing of 3 consecutive weeks), your bank account number and sort code and of course your contact name and  phone number.


Important clash

There is an important clash between the guidance published on 15th April and available on the usual government page and the guidance we have seen from HM Treasury – the latter states that to claim furlough there must be a written agreement in place that the employee will cease all work for the employer. This is different to the previous position (and indeed the current guidance on 15th April) which only required written notification of furlough. If the treasury note is accurate further work will be required to put the necessary agreements in place. We will monitor this situation and will update.

4th April updates

  • Shielding (again) on 4th April the government added a complexity that has now been removed – it is no longer the case that a shielding employee can be furloughed ‘if they would otherwise be made redundant’….they can simply be furloughed.
  • Sick pay & furlough – employees who become sick while furloughing can remain on furlough pay – they don’t have to be moved onto SSP & obviously if they are receiving furlough pay they should not receive SSP too, although furloughed employees who are sick must receive at least SSP (and so some swapping may still be required if furlough pay is less – seek advice before acting in these circumstances.)
  • TUPE – employees acquired under TUPE since 28th February can be furloughed. NOW 19 MARCH
  • Second jobs – employees can take a second job while furloughed but not for the same employer or any linked or associated employer.
  • Employees with children they need to care for (or other people for whom they are the main carer) because of COVID-19 can be furloughed.
  • Self employed contractors may be eligible for the Self Employed Income Support Scheme (SEISS) which is still extremely light on detail.
  • Pension contributions that can be reclaimed are a maximum of 3% on the amount of furlough pay allowed by the scheme i.e. 80% of salary capped at £2,500 pcm  – employers cannot claim back any additional contributions on any additional voluntary top up pay. Employers NICs are treated the same way.
  • Non cash benefits e.g. through salary sacrifice schemes cannot be claimed.
  • 20th April is the scheduled date for the portal (to claim grants) to open and employers may start to receive cash (said the Chancellor last night) ‘by the end of the month’.
  • 100% of the grant received for each employee must be paid to that employee – no deductions can be made for admin charges, fees or other employment costs (e.g. the cost of contractual non cash benefits.)


Previous updates

On Saturday 4th April the government released new guidance on the CJRS (‘Scheme’) clarifying some of what we knew already, changing some of what we previously believed and leaving important holiday questions still unanswered.

  • Employees Shielding Shielding takes place when an employee with particular vulnerabilities has received a letter from the NHS asking them to stay at home for 12 weeks.  Previous guidance stated that employees Shielding could be furloughed, new guidance adds ‘if they would otherwise be made redundant.’ This small addition will cause some headaches for employers. THIS HAS BEEN OVERWRITTEN BY THE 4TH APRIL GUIDANCE AND CURRENT GUIDANCE AT 15 APRIL
  • Carers and furloughing – if an employee has to stay at home to look after children (or others for whom they are the carer) they can be furloughed. Unlike Shielding there is no mention that these people would need to be in the ‘otherwise redundant category’ in order for their employer to be able to claim back furlough pay.
  • Keep letters for 5 years – furloughing letters stating the date furlough commenced must be kept for 5 years for HMRC inspections.
  • Second jobs – a furloughed employee can start a new job with a new employer (as long as their contract allows it, or the employer chooses to allow it) while furloughed. The new employer should ensure they complete the starter checklist form correctly. If the employee is furloughed from another employment, they should complete Statement C.
  • Company cars and healthcare costs – and other non-monetary benefit costs cannot be claimed back under the Scheme.
  • Fixed term contracts – can be renewed under the terms of the scheme.
  • Company Directors – can be furloughed and carry out certain statutory duties (but the base salary will be the basis of the 80% – not dividends.)
  • Contractual payments – including past overtime and commission can be included in the Scheme, whereas discretionary bonuses and tips cannot.
  • Minimum Wage – if 80% of normal pay is less than NMW it doesn’t matter unless the worker undertakes training while furloughed (in which case NMW applies.)
  • Minimum 3 weeks – furlough pay can only be claimed back if an employee is furloughed for at least 3 continuous weeks.
  • Contractually enhanced maternity etc. pay – can be claimed back under the Scheme (but not the statutory portion e.g. SMP, SPP, SPL, SAP etc.


Still not addressed – holiday

While we know that holiday will continue to accrue during furlough leave the guidance remains obstinately silent on whether employer will be able to claim back wage costs under the scheme for staff taking holiday while furloughed. This is a very large question still not to have answered.


Updated summary of CJRS (at 15th April 2020)

15th April 2020

We have updated our employer’s Q&As based on the government guidance published on 15th April. This is article is for general guidance only and is not a substitute for HR or legal advice on your particular circumstances.


What is the CJRS and what is furloughing?

The Coronavirus Job Retention Scheme is a temporary scheme open to all UK employers for at least three months starting from 1 March 2020. We expect the scheme to be up and running by the end of April. It is designed to support employers whose operations have been severely affected by coronavirus (COVID-19).

Employers can use a portal (expected 20th April) to claim for 80% of furloughed workers’ (workers on a leave of absence) usual monthly wage costs, up to £2,500 a month, plus the associated Employer National Insurance contributions (on the amount claimed, not any ‘topping up’ amount) and minimum automatic enrolment employer pension contributions on the 80% wage. Employers can use this scheme anytime during this period but employees must be furloughed for at least 3 consecutive weeks.

The scheme is open to all UK employers that had created and started a PAYE payroll scheme from 19th March 2020 and applies to any employee or worker who was on the PAYE payroll from that date.

Employers can only claim for furloughed employees that were on your PAYE payroll on or before 19 March 2020 and which were notified to HMRC on an RTI submission on or before 19 March 2020. This means an RTI submission notifying payment in respect of that employee to HMRC must have been made on or before 19 March 2020. Employees that were employed as of 28 February 2020 and on payroll (i.e. notified to HMRC on an RTI submission on or before 28 February) and were made redundant or stopped working for the employer after that and prior to 19 March 2020, can also qualify for the scheme if the employer re-employs them and puts them on furlough.


How long will the CJRS go on for and what happens when the government ends it?

At least 3 months from 1st March and it may well be extended. When the scheme ends employers will have to decide whether to return employees to work or consider redundancy (subject to following a fair process.)


How do I claim & what can I claim?

Employers can submit one claim every 3 weeks to cover 80% of the worker’s gross salary up to £2,500 per month + employer’s NICs and minimum employer’s auto enrolment contributions. The worker must have been employed on the employer’s payroll from March 19th.

HMRC are due to launch a portal on 20th April for employers to claim furlough grant.

For each eligible worker you will need to work out 80% of their monthly pay (to a max of £2,500) and the employer’s NICs and minimum auto enrolment contributions and register these on an HMRC portal when it’s available. You will need to keep copies of the furlough letters for 5 years to prove that the worker was furloughed for the period claimed. You can only claim from the date you furloughed the worker or from the date you made them redundant if that fell since February 28th (and have since re-employed them.) 

There is some conflict at the time of writing (16th April) as to whether employers will need to have a written notification of furlough in place for each employee or a written agreement (emails will do) that also includes a statement from the employee that they will do no work for the employer or any linked or associated employer in order to qualify for furlough grant. The current advice on .gov is that employers only need to have a record of ‘notification’, the contrary advice is contained on a directions document from the Treasury to HMRC we have seen but has not yet been translated into official government guidance.


Which workers can I claim for?

Anyone furloughed and paid through PAYE and who has been on your PAYE payroll since 19th March 2020, including:

  • full-time workers
  • part-time workers
  • workers on agency contracts
  • workers on flexible or zero-hour contracts

The scheme also covers workers who were made redundant since 28 February 2020, if they are rehired by their employer and subject to the PAYE and RTI rules below.

You can only claim for furloughed employees that were on your PAYE payroll on or before 19 March 2020 and which were notified to HMRC on an RTI submission on or before 19 March 2020. This means an RTI submission notifying payment in respect of that employee to HMRC must have been made on or before 19 March 2020. Employees that were employed as of 28 February 2020 and on payroll (i.e. notified to HMRC on an RTI submission on or before 28 February) and were made redundant or stopped working for the employer after that and prior to 19 March 2020, can also qualify for the scheme if the employer re-employs them and puts them on furlough.


Can I furlough workers and then have them do some work still?

No, they must not work for you at all while on Furlough leave from your employment, neither can they work for an associated or linked employer.

If there is some work to do but less than normal, a more appropriate route would be to agree with the worker to reduce their working week for a period. Our earlier article and another earlier article containing a template agreement to reduce hours covers various ways of achieving this.


What about national minimum wage?

This won’t apply during furlough leave unless the employee is asked to undertake training (in which case it will.)


Can I require furlough workers to undertake training e.g. on-line courses?

Yes, but you must ensure that they receive at least the national minimum/national living wage for the duration of the training.


Can I automatically furlough workers?

You will need at least a notification of furlough or a written agreement from your workers to go on furlough leave and they must confirm in that agreement that they will do no work for you while furloughed and you must keep these letters for 5 years as evidence. (myHRdept has template letters for this purpose, free for existing retained clients.) There is some conflict at the time of writing (16th April) whether employers will need to have a written notification of furlough in place for each employee or a written agreement (emails will do) that also includes a statement from the employee that they will do no work for the employer or any linked or associated employer in order to qualify for furlough grant. The current advice on .gov is that employers only need to have a record of ‘notification’, the contrary advice is contained on a directions document from the Treasury to HMRC we have seen but has not yet been translated into official government guidance.


Can I switch people in and out of furlough status?

To be eligible for the grant the worker must furlough for a minimum of 3 continuous weeks.


Can a worker carry out voluntary work while furloughing?

Yes, but not for the employer or any linked or associated employer – they could work for the NHS as a volunteer for example. They must not do anything to make money for or provide services on behalf of their employer or any linked or associated employer.


I’ve already made redundancies because of COVID-19…can I reverse them and furlough workers instead?

If you made redundancies since Feb 28th you can rehire the worker and furlough them, subject to the worker satisfying the PAYE and RTI status described in earlier questions.


Can I furlough workers I wasn’t planning to make redundant?

Yes, the guidance on 15th April made it clear that workers do not necessarily need to be at risk of redundancy, the scheme is intended to help employers maintain their current workforce while their operations have been severely affected by coronavirus (COVID-19.) If you were planning to lay workers off without pay for a period because of COVID-19 (i.e. a step short of making them redundant) the furlough route would seem a viable alternative. Obviously if you still have work to do then it is not.


Does the employer have to pay the other 20% of a furloughed worker’s wages?

No, but it might choose to top up wages to the CJRS cap of £2,500 per month or indeed to the workers normal wage if higher. This is entirely at the employer’s discretion. If it chooses to do so the employers NI and employers pension can only be reclaimed on the 80% limit, not on any amount the employer chooses to top up.


Is pay while furloughing taxable & pensionable?

Yes, tax and NICs will be deducted from furlough pay as well as auto enrolment contributions unless the worker has opted out.


Can I top up some people’s wages but not others?

Provided the employer is careful not to select workers for top up on discriminatory grounds this should be possible. Seek advice from myHRdept.


What if someone is on unpaid leave, off sick or on maternity leave – can they be furloughed?

Workers placed on unpaid leave AFTER 28th February can be furloughed (but not before), workers on sick leave or self-isolating should get SSP, but can be furloughed after their sick leave or self-isolation ends. Workers on maternity and other statutory family leave should continue to receive SMP, SAP, SPP etc. but can be furloughed once the statutory leave comes to an end. Workers who are shielding in line with public health guidance can be placed on furlough leave. If a worker becomes sick while furloughed it is up to the employer to decide whether to leave them on furlough pay (we expect this to be the default position in most cases) or move them to SSP. The latter will be necessary if SSP is more than furlough pay.

In the case of workers on unpaid leave prior to 28th February the period of unpaid leave must continue until the agreed end date, after which they can be furloughed.


What is ‘shielding?’

Certain high risk people have been asked to stay at home and not go out at all with the exception of if they have a private garden. Those most at risk include:

  • Solid organ transplant recipients
  • Some people with cancer who are undergoing treatments such as chemotherapy and radiotherapy
  • People on immunosuppression drugs
  • Women who are pregnant and have heart disease
  • People with severe respiratory conditions – cystic fibrosis, severe asthma and COPD
  • Some people with rare diseases such as severe combined immunodeficiency

Workers who are shielding (or having to stay at home with someone who is) can be furloughed.

More information on shielding can be found here.


I have workers self-isolating on SSP – can I furlough them instead?

They should remain on SSP but can be furloughed once they finish sick leave or self-isolating.


What if the worker has more than one job or wants to get another job while furloughed?

A worker can be furloughed from more than one job, and the cap will apply to each employer individually. The guidance states that a worker can get a second job while furloughed providing it is not with the employer or any associated or linked employer.


Does a furloughed worker continue to accrue holiday?

We will need further government guidance here, but in the absence of that it would be safest to assume that holiday will continue to accrue during furlough absence.


Can a furloughed worker take holiday? 

Again the guidance is very quiet here, our assumption is they can, but that holiday would need to be paid at their normal pay rate, and we don’t know whether any amount can be reclaimed as a furlough grant. It’s safest to assume it can’t be (because furlough and holiday are different things.)


I’m worried that my furloughed staff will return with a lot of accrued holiday, is there anything I can do? 

The government has amended the working time regs to allow up to 4 weeks holiday from this year’s holiday entitlement to roll over into the next 2 holiday years. Remember holiday is by permission so employers will be able to refuse excess holiday requests and defer holiday even into future holiday years if they need to.


Will a zero hours/variable hours worker be entitled to furlough?

Anyone paid through PAYE since 19th March will be eligible for furlough leave and if furloughed their employer can claim a CJRS grant based on the higher of:


  • the same month’s earnings from the previous year (if furloughing for the March pay period, the earnings from March 2019); or
  • average monthly earnings for the 2019 – 20 tax year.

If variable hours workers have less service, simply use an average of their normal pay to date.


How do I select who to furlough (if it’s not everyone?)

Follow a similar exercise to redundancy – if you only need to furlough say 10 out of 20 drivers, then the selection criteria must be fair e.g. last in, first to furlough. Workers on maternity leave or with other special characteristics may have additional protections – take advice from myHRdept.


Practically how do I put workers on furlough?

myHRdept have developed two template letters for this purpose: a) for situations where the employment contract has a lay off without pay clause and b) for cases when no such clause exists. The difference is that in a) you can get on and do it whereas in b) you’ll need to get the worker’s agreement (we’ve included an acceptance signature bar.) NB These templates will be updated again once it is clear whether agreement is needed, or whether a record of notification will suffice.


In circumstances where the business damage is likely to take a very long time to recover is furloughing the answer?    

We know that furloughing will continue for at least 3 months, but we don’t yet know if it will be continued. Sometimes an event like COVID-19 requires a permanent or semi-permanent adjustment to business headcount and if that is the case then redundancy might still be the most appropriate option.


Are there any risks to furloughing workers?

The risks as we see them are far outweighed by the benefits, but here are our thoughts:

  • If a worker has just short of 2 years service when being furloughed, they could reach the 2 year point while on furlough. At 2 years UK workers acquire certain rights including the right to a redundancy payment and the right to claim unfair dismissal.
  • A furloughed worker who has had their earnings reduced may bring a breach of contract claim. This risk can be mitigated by a) having a contractual right to reduce pay or b) to obtain the worker’s agreement prior to furloughing them. Agreement is always best in employment law and employers may seek to gain agreement even if they have a contractual right to impose.



Finally an appeal from myHRdept. Our staff are working flat out trying to help employers with headcount reduction challenges. We please ask customers to only make essential support requests for the next 2 – 3 weeks and to please bear with us as certain non-urgent tasks (contract templates, policy updates etc.) are going to a take a lot longer than normal. Thank you for your understanding and please stay safe.

If you’re thinking of outsourcing your HR or employment law needs, why not 
contact myHRdept? Call us on 01628 820515 to discuss your requirements or contact us and we’ll call you back.

















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