Furlough leave – update

HMRC have now released the first statistics for the Coronavirus Job Retention Scheme following the launch of the online portal on Monday morning. The portal has appeared to have worked surprisingly well and during its first day of operation:-

• 185,000 firms submitted claims
• 1,300,000 employees were reported as furloughs
• A total value of £1.5bn was claimed for employees’ wages

To get written consent or not to get written consent?

There still remains a disparity between the guidelines for the Coronavirus Job Retention Scheme issued by the Treasury and the guidance issued to employers by HMRC.

Should I get written consent to furlough employees?

The Treasury guidance states that written agreement to being furloughed is required from employees in order for employers to claim the employees’ salaries under the Scheme. This position is very clear and the Treasury is a more senior source than HMRC.

 Should I rely on written notification of furlough?

However, the guidance from HMRC to employers only states that employees need to be notified in writing that they are being placed on furlough leave, and does not state that any agreement from the employee is required. This has led to a great deal of confusion and worry for businesses given that they had been relying on HMRC’s guidance before the Treasury released its own stipulations.

So, given the confusing guidance, what should I do?

From anecdotal evidence, it appears that HMRC are still making payments under the Scheme even where there is no written agreement from the employee to being furloughed. Those businesses who have not yet obtained written consent from employees who are placed on furlough leave may now be content to proceed without such agreement in the knowledge of this. Given that chasing employees for written agreement to being furloughed can lead to further problems arising, for example, if they say they are not agreeing to be furloughed, it is likely to be a legitimate “risk versus reward” decision for businesses to make in deciding whether or not to forego written agreement from employees if they don’t already have it and hope that the Treasury don’t insist on their guidance being adopted by HMRC.

If you have any questions about the Coronavirus Job Retention Scheme, or anything else that may be affecting your workforce in these difficult times, our HR and Employment Law team is on hand to help.