Furlough Update from 1st December 2020

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From 1st December 2020, employers will no longer be able to place employees on CJRS during their notice period.

Last week the Government provided some additional guidelines for the extended furlough scheme running from the 1st November to the 31st March 2021.

One of the main stipulations in the updated guidelines is that from the 1st December 2020, furlough cannot be used to pay contractual or statutory notice period that falls on or after 1 December.

What does this mean in practice?

To date, many employers have used the furlough scheme to pay towards statutory and contractual notice pay by “topping up” furlough pay to an employee’s full salary.

From the 1st December this will no longer be allowed, and furlough will not be able to be claimed for notice periods. Employers will therefore need to pay notice periods in full with no Government assistance.

FAQ

1. If someone is already serving their notice period and being furloughed, what are our options?

You can only claim furlough money up to 30th November After that you can either bring the person back to work, to work out their notice, put them onto gardening leave, or pay them in lieu of their notice period.

This is going to be an admin burden for employers who will need to write to their employees on notice to change arrangements.

The individual employee’s income shouldn’t change, as it is already a requirement to make furlough up to 100% for notice periods.

2. Is it worth rushing through redundancies to speed up the process?

It is never worth rushing through redundancies!

There is a significant cost to getting redundancies wrong in terms of appeals and even tribunal claims. Even working at high speed, to fairly consult with your employees, it takes 10 days to run the process (for less than 20 redundancies). Even starting today, you would only save a few days of notice period money, which is unlikely to be worth the cost of rushing the process and getting it wrong. 

Harwood HR – Bristol & Surrey based HR Consultancy providing Outsourced HR Services. We provide clear, cost effective HR advice. For a free consultation, please contact us on:

0117 439 0119 or info@harwood-hr.co.uk

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