Lockdown – what do employers do now?
As the UK goes into lockdown to protect the spread of Covid-19, many employers are set to face a significant downturn of work. We explore some of the key questions for employers during this time.
Who is allowed to go to work during lockdown?
All non-essential businesses have been asked to shut and the full list of what this includes is on the government website: https://www.gov.uk/government/publications/further-businesses-and-premises-to-close
There is still uncertainty as to what non-essential includes, despite the government guidance. Prime Minister Boris Johnson stated that “travelling to and from work [is permitted], but only where it is absolutely necessary and cannot be done from home”. Anyone attending work is required to observe the social distancing rules and stay at least 2 metres apart.
What if my staff can’t work from home?
For some employers their staff simply cannot work from home but equally going into work may not be appropriate either.
In such circumstances employers may consider laying off staff, reducing hours (known as short time working), asking employees to take holiday or unpaid leave. See our previous guidance note for further information; HR Coronavirus – How to approach an unexpected downturn in work.pdf
Do I have to pay them?
In general terms, employers do not usually have to pay their staff if they cannot attend for work. These are exceptional times and employers may want to give consideration to offering, where appropriate, the Government Job Retention Scheme so that they can retain employees on a reduced wage (funded by the government) and still be ready to do business when things pick up again.
What do we know about the Government Job Retention Scheme?
This is being called “Furlough leave”. Employers who “furlough” their staff (meaning they put them on a temporary leave of absence whilst retaining them as employees) will be able to obtain a grant from the government to cover up to 80% of an employee’s wages, up to a maximum of £2,500 per month. What is not clear is:
- Whether employer national insurance and employer pension contributions are to be included within the £2,500 (we believe this to be the case but this has not been confirmed).
- Whether the payments to the employee will be subject to tax.
- When the grants will become available and how long the scheme will last for.
- What the position is for staff on statutory sick pay.
- What the position is where 80% of salary takes someone below the national minimum wage.
It is understood that the Furlough Leave can be backdated to 1 March 2020 for employers who may have already taken such steps provided they have remained on payroll. Currently, the government is indicating that the scheme will be set up before the end of April, which does not give much comfort to employers who need to make urgent decisions.
What should I be doing now?
We would advise employers to:
- Check contracts of employment/staff handbooks to determine whether there is contractual right to place employees on lay off/short time working.
- Analyse your workforce to understand which roles will be business critical and which ones may be suitable for the Furlough Leave option.
- Where appropriate, take steps to seek consent from employees to place them on Furlough Leave should it become necessary.
- Explore other options which could be offered to staff instead of Furlough such as reduced hours, unpaid leave, taking holiday or voluntary redundancy.
We are keeping our fingers on the pulse with any developments in this area so do watch this space. For any help and support please contact our employment law team on 0345 20 73 72 8 or at firstname.lastname@example.org