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Key considerations before you send your ‘furlough letter’

Posted on: March 26th, 2020 by Ginny Hallam

There’s a bit for you to consider before you send your first furlough letter.

For those employees with a contractual lay-off provision, consider…

  • Whether you still need to ask employees for their agreement to designate them a furloughed worker, or can you just write to them informing them of their new status.
  • Whether you understand fully a furloughed worker’s rights to ask for a redundancy payment after four weeks of furlough (only relevant to those employees with a lay-off provision within their contract).

For those employees without a contractual lay-off provision, consider…

  • Are you going to ask them to confirm their written agreement to the changes? If so, how do they do that?
  • Does their employment contract state how you need to effect the contractual change? In which case, are you going to be able to comply?
  • If employees don’t confirm their agreement to the change, how are you going to show they have impliedly accepted?
  • What are you going to give to the employee in return for changing their status to a furloughed worker (legally you need to give them something for the change to be enforceable)?
  • Are you clear on what the alternatives are to furloughed working for those employees who don’t accept the change?

Either way, consider…

  • If you are going to top up pay beyond the amount you’ll be reimbursed from the government, do you want to set out terms in respect of that top up?
  • Are you clear on what you’re going to pay each furloughed worker (80% pay, £2500, more, less) and what is included within that pay (pension contributions, employers national insurance)?
  • Do you need to split furloughed workers into categories (those that fall above and below the £2500 contribution from the government, for example) and treat them differently?
  • How are you going to deal with any benefits the employee is entitled to during furloughed work?
  • How can employees secure quick answers to their questions or object to the change?
  • Have you been clear to managers about the rules around furloughed working and what they should and shouldn’t be saying to their teams?
  • Are you clear on how you’re going to select some employees and not others for furloughed working?
  • How are you going to communicate with those employees who are absent?
  • Are you going to set out when you anticipate the furloughed leave will end?

There’s always more to say but this is a good starting point. Click here if you want us to give you a call.