On Friday afternoon, the Prime Minister and Chancellor announced a package of measures to help businesses and during the course of doing so used the phrase “furloughed workers” which is a term known to almost nobody.
This guidance is likely to be updated/amended very quickly in line with changes to law and practice as and when it occurs during the course of the week.
The coronavirus job retention scheme
The announcement was captured succinctly, albeit probably inaccurately, by any major news outlet which almost immediately ran with “government to pay 80% of wages”. This is not quite what Rishi Sunak said and the government website says as much.
What Has Been Announced?
The Coronavirus Job Retention Scheme has been established under which the government allows businesses to access funding to meet up to 80% (to a maximum of £2,500/month) of employee costs.
These funds will be available to businesses who can designate individual employees as ‘furloughed workers’ and the information must be submitted to HMRC in order for funds to be released.
What Is A Furloughed Worker?
The Government advice describes the scheme as being paid to those who “would otherwise have been laid off during this crisis”. We have to assume that laid off is taking its common rather than legal meaning and that therefore we can read this to mean that it basically means employees who would otherwise have been made redundant.
Read the full article here.