April 7, 2020

What you can do on Furlough Leave

This post was written by: Ilinca Mardarescu

It wasn’t long ago that no-one had heard of the term “to be Furloughed”.  Now, it is one of the most common terms being used in employment law terms.

The term (which derives from the Dutch word Verlof), means to be granted a leave of absence and until recently was more commonly used for military personnel or services.  However, in these unprecedented times the Government have introduced the Coronavirus Job Retention Scheme (also known as Furlough Leave) to assist business with their staffing costs in order to prevent redundancies and job losses.  

In essence, HMRC will be paying a grant to employers for up to 80% of an employees’ wages (up to a £2,500 limit) where that employee has been asked to stay at home and not undertake any work.   

Guidance is being published on an almost daily basis as to how this will work in practice but recent guidance has confirmed some interesting (and welcome) new information in relation to voluntary work and second jobs.

Interestingly, the recent HMRC guidance has clarified that employees can start a new job when on Furlough.  This means that potentially an employee could end up earning 80% of their old salary under Furlough and then a further 100% from a new job which they take on.  It should be noted that this must still be allowed under the original contract of employment however so employees will need to check this (or seek their employer’s consent).  With the weather turning and farmers up and down the country desperately seeking help with their crops, now would be a good time for those on Furlough Leave to spend a month or two helping the nation whilst also earing themselves a little extra money.

Similarly, an employee on Furlough leave is able to volunteer.  Indeed, many in these challenging times have already started doing just this and it is heart-warming to see communities coming together and helping those more vulnerable.

There are few opportunities that many of us will have to make a real, tangible difference and impact in quite this way.  Most of us, in more normal times, need to work to earn a living. The Government’s scheme however may have a surprising outcome by allowing anyone on Furlough leave to spend a considerable amount of time volunteering and helping where it is needed most.  Social distancing is crucial right now but that doesn’t mean we can’t come together in different ways – for the good of the country.  

If you’re keen to implement a furlough, or have further questions if you have been placed on furlough. Please don’t hesitate to contact our Head of Employment Law, Ilinca Mardarescu.