News update – Coronavirus Job Retention Scheme: March 2021 Budget Announcement
The Furlough Scheme has now been extended until the end of September 2021.
There will, however, be some changes which will come into play from July 2021.
From July 2021, businesses will be asked to contribute 10% towards the Scheme. From August and September 2021, businesses will be asked to contribute 20%. Employer contributions (apart from NI and pensions) won’t be requested in April, May or June.
Employees will still receive 80% of their salary until September 2021.
News update - 31 July 2020
Under new laws that came into force on Friday 31 July, furloughed employees who are being made redundant will receive statutory redundancy pay based on their normal amount of pay and not their reduced furlough pay.
This legislation also applies to other employment rights, such as statutory notice pay and awards for unfair dismissal, which are calculated on the basis of an individual’s average weekly pay.
Read the full announcement from the government by following this link.
In light of the ongoing disruption caused by the Covid-19 crisis, we’ve been preparing extra resources for employers and employees who are facing a possible layoff or redundancy situation.
We're also keeping up to date with the latest announcements over on our blog:
You can also find all of the government’s own Covid-19 guidance and documentation for business via the gov.uk website
Can I temporarily lay employees off or reduce their hours?
Yes, but only if your employment contracts with the employees in question contain a clause that allows you to do this.
If that’s the case, and you reduce employee hours or temporarily lay them off, you can reduce their pay. Depending on the duration of these arrangements, your employees may be able to claim redundancy pay. See our guide to lay-offs and short-term working for more detail.
I’ve got no choice but to close my company, what are my obligations to my staff?
This sounds like a classic redundancy situation and this guide contains the steps and materials that you need.
You must make sure you run a fair and proper redundancy process, even in these circumstances, which includes properly notifying employees and explaining the circumstances to them (called ‘consulting’ with employees).
To ensure you’re acting lawfully, you have a duty to consider whether there are any less drastic alternatives to making staff redundant–and you’ll need to evidence that you did consider this responsibly.
Employees who have been employed for over 2 years within your business will normally be entitled to redundancy pay, and the value of this will depend on their age, how long they’ve worked for you and their regular pay (measured weekly).
What you need to know and do is covered below...
Making redundancies can be a stressful time for both you and your staff. We've collaborated with Wilkes to produce this guide full of practical advice that makes the process clear, and helps you deal with redundancy dismissals as fairly as possible.
Before you make the decision to start a redundancy process in your business, it’s important to double-check that you’ve considered other potential alternatives first. For example, layoffs and short-time working may be a better solution for temporary work shortages. (We'll touch on a number of other alternatives below too.)
However, if none of the alternative options work for you, you probably need to consider redundancy.
You should have an existing redundancy policy. This will steer you through the logistics and time-frames involved in the process, because redundancy is a very process-driven exercise and it’s important to ensure that you take the essential steps at the right time, with the right people and using the most appropriate communications and choice of wording.
Meanwhile, this guide provides a step-by-step recipe, bringing together all the relevant materials, options, calculations and legal necessities, to help you make the process as smooth and fair as possible for both you and your employees.
Even with this guidance, we strongly recommend that you also take good expert advice on how to approach and manage this process. It will help to avoid inadvertent omissions or errors that can cause difficulties later.