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Coronavirus: what you might have missed

02 Apr 2020

The world of work has changed unrecognisably in a few short weeks – and so has employment law and HR practice.   Virtually every day has brought announcements of new measures affecting businesses and their staff. 

We have provided detailed guidance on the Coronavirus Job Retention Scheme (furlough) , sick pay and self-isolation and more, on our Employer FAQ page.    

Furlough

There are some important aspects of the furlough scheme which currently remain unclear.  For example, there is no government guidance on whether holiday can be taken during furlough, although ACAS guidance suggests not.  Likewise, there is no government guidance on whether tips, service charges and tronc payments can be included in the calculation of the 80% of pay due to the employee.

There is an important gap in the furlough scheme in relation to employees who have transferred under TUPE since 28 February 2020.   As those employees were not on their current employer's payroll on 28 February 2020, their current employer will not be able to claim reimbursement of their pay from HMRC under the furlough scheme.   This may be a significant barrier to business rescue deals. 

The issue of collective redundancy consultation and how this interacts with furlough is complex.  Employers need to consider in each case whether they need to consult collectively with elected representatives of affected employees when they are implementing furlough arrangements.   In some cases, the employer may not have formulated clear proposals for making redundancies if employees do not agree to be placed on furlough.  We anticipate that this may apply to businesses which have reduced demand but which are not currently closed, which would need to assess how many employees had agreed to furlough before being able to determine how many redundancies would be necessary.    In those cases, the employer may not need to consult collectively at the point at which they are seeking agreement to furlough terms.   

However, for some businesses it will be clear from the outset that if employees do not agree to be placed on furlough the business will need to make redundancies swiftly (particularly where the business is closed).   In those cases, there is a greater risk of protective awards (of up to 90 days' pay per affected employee) for failure to consult collectively and criminal liability for failure to submit form HR1.  Employers may be able to benefit from the 'special circumstances' exemption where the impact of the lockdown and closures makes it not reasonably practicable to conduct collective consultation – but in such cases the employer must take steps to comply as far as it can.   In each case, employers should seek advice and weigh up the risks of the various options. 

Holiday

The government has published regulations allowing employees to carry over 4 weeks of annual leave for up to 2 leave years if the impact of coronavirus has meant that it was not reasonably practicable for them to take the leave in this leave year.    Despite initial announcements, this is not restricted to staff in particular sectors or key workers. 

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