With lockdown easing, some businesses may need to bring furloughed staff back to work again as things begin to improve. B P Collins’ partners, Jo Davis and Chris Brazier, advise employers on what they need to do next.
Bringing furloughed staff back to work
With the lockdown easing, business owners may be seeing an increase in productivity and, as a result, thinking about bringing furloughed staff back to work.
If you think you need your employees back permanently, then it is straightforward to bring them back. Depending on the terms on which you agreed with your staff when they were placed on furlough, you will issue them with notice that the furlough is coming to an end and they are required to return to work. That may be just a phone call or, if you said you would give notice in writing, you will need to do so by email or letter.
If you think, however, that you might need some staff for a few days and they won’t be needed again until the flexible furlough scheme begins on 1 July 2020, you can bring staff back for a day or two and then they can be placed back on furlough. However, under the current scheme, you still need to furlough an employee for at least three weeks so this potentially causes problems as you will be overlapping two schemes. The new Government guidance says:
“From 1 July, employers who previously submitted claims with periods that overlapped calendar months will no longer be able to do this going forward. This is necessary to reflect the forthcoming changes to the scheme.”
To avoid any issue, therefore, it may be advisable to wait until 1 July to re-furlough and limit the number of staff you bring back. If that isn’t an option, then it appears that two separate claims will need to be made for the three-week period, one under the old scheme to 30 June and another under the new scheme starting on 1 July 2020, however, there is no clarity on how HMRC will respond to that claim at the current time. As such, if you can wait, you should do so.
How do I operate the furlough scheme moving forward?
Firstly if there is insufficient work for employees to return, the scheme will operate as before, but with claims being made in accordance with the new claim periods (so not straddling a month and a covering a period of no less than 7 days)
However, it is hoped that, as workloads increase, employers will bring back larger numbers of employees part time or flexibly, rather than choosing a few employees to return to their usual hours, whilst leaving others fully furloughed.
There are obvious benefits to embracing flexibility. It gives employers the benefit of a larger skill set and will help those employees feel like they are part of the future rather than becoming more and more removed from the business. It also allows employees with other short-term challenges, such as childcare issues, to manage their return without it being an all or nothing choice.
It’s important to note that there is the increased administrative complexity attached to the new scheme. HMRC has published detailed guidance around the calculations that will apply to flexible furlough claims. You will need to take care, for audit purposes, that flexible furlough claims match the agreements reached with employees so that the claims are consistent.
Communication is key
Irrespective of your decision, employers should be taking steps to keep in contact with their furloughed employees. From a duty of care perspective, the pandemic has created a huge amount of anxiety and insufficient communication from employers may add to those concerns and therefore, maintaining good communication is key.
As a reminder, the furlough scheme closes to new entrants on 30 June, so if you’d wanted to furlough a particular member of staff, you would’ve needed to have put them on furlough by 10 June 2020.