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Furlough - Why Wouldn't You?

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As a nation we seem to love our acronyms. For the simplistic mind, of which I am absolutely one, calling the “Furlough Scheme” something else, never really crossed my mind. I mean it does what it “says on the tin”. But the scheme which by the 9th April, had 3 updates since its onset, has itself 3 names - The Coronavirus Furlough Scheme a.k.a. Coronavirus Job Retention Scheme or for short, CJRS.

I hear from employers and employees alike, who remain confused by the whole thing, and a whole complicated industry seems to have been created around the term furlough, whether or whether not to furlough, how much to pay those in furlough; the list goes on.

The government created this scheme to support employers facing the possibility of permanent closure as an alternative to laying people off or making sweeping redundancies in the height of the Coronavirus crisis. No-one knows how long this crisis will last, business owners, employers, employees, children – basically everyone knows that there has been and continues to be changes to their lives. No-one is going to know what the economic impact is going to be afterwards. We can hypothesise, plan as best as we can, some businesses can and have started to change the way they operate. But the reality is no-one really does know.

What has become more apparent is the level of criticism levied at some employers for the way they are treating their people. Popular brands, those headed by celebrities are at the forefront of the criticism by taking the CJRS funding available to businesses. Comments made that they have a large personal worth or the business makes a lot of money, even crowd funding petitions are a regular article on social media as well as on front pages of the news. But the reality is this scheme is open to all employers, large or small.

Yes, some employers of note are using the scheme, but some are not. It appears that those who perhaps have a greater financial reserve are not. No-one knows the financial status of these businesses that are lambasted by the press. Some may be headed by individuals with celebrity status, but it would appear to me, that their wealth isn’t just a bank account with that money sat in it; but their wealth could be in property, assets that at present they probably couldn’t sell even if they wanted to. I have no idea to be honest, but in my pragmatic head, I would hope that the desire to marginalise these people, those who act as judge, jury and executioner, would look at the true facts, not just jump on the judgemental bandwagon.

Back to the topic at hand - furlough!

It seems to me that when I use the term “common sense”, there really is no bounds to some people’s reasoning. Even after the amount of time supporting people’s business, I am still genuinely surprised by the way they choose to treat their people. When the chips are down, out goes any resemblance of common sense, the treatment of their number 1 asset goes out of the window, in favour of cash.

Now I appreciate cash is an important commodity, however there is nothing that you can do in life without the help, support or guidance of people. Not everyone is financially motivated; cash can be a short-term end to a means, however if you want to maintain, retain and grow, the treatment of your people should be your number 1 consideration. I mean, would you expected to be treated like this yourselves? Would you treat a family member, a parent, a partner, a child, like they were not important, just a number?

Perhaps you would, and yes, I have seen that too, and having lived that life, I also know that treating people in such a way does not bring trust, integrity, commitment – instead it provides disinterest, apathy and lack of motivation. The lack of care is replicated, like a mirror, employer to employee. Success after all is greatly attributed to the people within the business!

So, furlough…

At the time furlough was introduced, a multitude of businesses jumped at the chance to protect their greatest business asset, their people by taking the opportunity to furlough. There was a real chance, and still is, of companies having to cease trading, to make mass redundancies, and given that we as a world, are facing the unknown, it seemed a sensible and common-sense approach to take.

Common sense

The other common-sense approach to take was to protect those individuals at greater risk from the infection itself. To shield them from the chance of catching the virus; those who, if they did catch it, have a high probability of requiring hospitalisation and needing intensive support. This group, in the UK, we are told amount to around 1.5 million people. As a nation, our mantra, is and has been to protect the NHS, stay at home and save lives.

This shielded group have been written to by the NHS and “instructed” to stay at home; food boxes, prescriptions get delivered to them, and above all, not to go to work. And this impacts their families as well, anyone living with them was subjected to at least self-isolation, and unless they can work from home, should not go to work themselves.

There are also others in a higher risk group. Those who have life limiting conditions who are required to self-isolate at home for a lengthy period of time as well. This group identified by the government at greater risk of contracting the disease is permitted out, but given the advice is that if they get it, they could quite probably die, essentially why would they go out. I am within this group, and once a week I take a trip in the car, a few miles down the road to sit in my office, alone with the door locked just for a change of perspective. I may see a couple of people, wave at them from the distance, sit outside my office and have a coffee, just to take in the air. This is my new normal.

However, the largest quantity of questions that I get asked is around furlough for the shielding and for the high-risk group; especially if the business is still trading. The government guidance, as I said at the beginning, has changed on at least 3 occasions so far. However, in my view, surely this is where common sense should come in.

The guidance had initially stated that employees who are off sick and are entitled to statutory sick pay (“SSP”), or who are self-isolating in circumstances where they qualify for statutory sick pay, could not be furloughed under the Scheme until the relevant absence had ended. However, this has changed. And now states that employees who are off sick can be furloughed just like any other employee.

The guidance also states that if an employee becomes sick whilst on furlough, they retain their statutory rights, which includes SSP. So, if a furloughed becomes ill, they must be paid at least SSP, but it is up to employers to decide whether to move these employees on to SSP or to keep them on furlough.

Common sense comes in when looking at the pay rate for each scenario. SSP is paid at £95.85 a week (as of 6 April) and furlough is at 80% of an employee’s wages. Employers can claim back within set criteria for both types and of course furlough has a set minimum limit of 3 weeks. So, it is perhaps worth checking and agreeing on each individual case before deciding which pot an employee would be better within. Treat your employees as individuals rather than as a number.

For the group that are shielding, or for employees who had to stay home with those that were shielding, the guidance previously had said, that unless they could work from home, or there was essentially a business down turn, they were only to receive SSP and were not permitted to be furloughed.

This seemed crazy at the time to all circles. Why would someone who was essentially not permitted to work, be penalised financially by receiving £95.85 per week if their salary was in fact greater? This would not ensure their safety as many would, and did, carry on working, placing themselves and their families at greater risk.

Common sense prevailed and the government changed the guidance. This group of people, could now be furloughed. There was no requirement for businesses to demonstrate a downturn in work, if someone in this group could not work from home, then the reasonable choice for any employer was to furlough them.

HM revenue and customs logo

An employer would apply for the CJRS grant through the HMRC, safe in the knowledge that they were showing a duty of care to their employees. The employee could remain at home safe in the knowledge that they were receiving at least 80% of their salary (remembering that employers could voluntarily top this up), they would not place themselves, their family members or colleagues at risk and that their employer actually cared about them.

You would think that this would be an easy decision then for an employer.

Apparently not.

The guidance does say that shielded people, “can be” furloughed not “must be”. I agree, there is no absolute requirement for employer to do so, but the key question is “why wouldn’t they?”

The guidance set out by ACAS mentions that: “If an employee is still being asked to go out to work and they believe they're at risk because they're in one of the vulnerable groups, it's important they talk to their employer.” And goes on, “If they cannot follow guidance on social distancing at work or during travel to work, they should tell their employer they need to follow government advice and stay at home.” So, if an employee in this group, cannot work from home, cannot be assured of social distancing in their workplace, they could ask to be furloughed.

Again, I ask, why wouldn’t an employer furlough them?

It is known that any employee is protected by law against unfair treatment and dismissal, if it's because of pregnancy, age or a health condition that's considered a disability under the Equality Act. There is no doubt that those in the shielded group are considered disabled. It doesn’t matter how long they've worked for the employer, there could be unlawful discrimination on the grounds of pregnancy, disability or age if an employer either:

  • unreasonably tries to pressure someone to go to work

  • unreasonably disciplines someone for not going to work

So, a further question then arises; if any employer flatly refuses to furlough the shielded employee, is that a case of the employer unreasonably trying to pressure someone to go into work? After all, SSP is a mere £95.85 per week and 80% of wages is in most cases, significantly more. As an employer are you then placing your employee at financial detriment by applying SSP instead of the more lucrative (I use the term loosely) furlough pay? Pay that you can legitimately claim back.

The employer will undoubtedly argue, the government guidance does not say they must be furloughed, just that they can be. So, we are back to the original question, why wouldn’t they?

In my naïve mind, I think that all employers would use their common sense, treat their staff with respect and integrity, and yet every single day, I hear stories of companies large and small, just not considering the reasonable and appropriate course of action for the human being who supports their business. Not considering how they would actually feel if it was them in the shoes of the person that they have just made a decision about. A decision that not just impacts their finances but also the impact on their mental health, their families, their future….and actually your future. An employer who doesn’t treat people with respect and integrity, especially now in the time of great challenge, doesn’t deserve to have that person in their business.

When this is all over, the country, and the world will look back at these employers. Their measure of success is not just cash, its whether you treat the greatest asset that you have, your people, with the respect and integrity that is deserved.

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