Businesses should pass three tests before bringing their people back to work

The Government has indicated that organisations with employees who are unable to work from home, such as construction and manufacturing workers, should start planning for their return. Full government guidance on working safely is expected later this week but, in anticipation, the CIPD is urging businesses to ensure they can meet three key tests before bringing their people back to the workplace:

1. Is it essential?

If people can continue to work from home they must continue to do that for the foreseeable future. If they cannot work from home, is their work deemed essential or could the business continue to use the Government’s Job Retention Scheme for longer, giving them the time needed to put safety measures and clear employee guidance and consultation in place?

2. Is it safe?

Employers have a duty of care to identify and manage risks to ensure that the workplace is sufficiently safe to return to. This will involve social distancing measures, potentially reconfiguring workspaces and common areas, possible changes to working hours to reduce risk of exposure, and increased workplace cleaning and sanitation measures. Employers should take their time with gradual returns to work to test these measures in practice and ensure they can work with larger numbers before encouraging more of their workforce back.

3. Is it mutually agreed?

CIPD research found that four in ten people are anxious about returning to work and there are concerns people could be forced back. It’s vital that there is a clear dialogue between employers and their people so concerns, such as commuting by public transport, can be raised and individuals needs and worries taken into account. To manage some of these issues, there will need to be flexibility on both sides to accommodate different working times or schedules.

CIPD Chief Executive Peter Cheese warns that even when these three conditions are met, the return to work must be gradual: 

“The return to work is a massive undertaking for employers and is likely to prove much harder than the original lockdown as there are so many variables. As the ongoing health threat continues no employer should be rushing to get their people back to work until they can meet three conditions: is it essential, is it safe and is it mutually agreed with the workforce. Even with those measures in place the return to work must still be gradual so that social distancing can be maintained.

“It is important that organisations can learn what works practically to be able to provide guidance and reassurance before increasing numbers of their people in the workplaces. A gradual return may also mean flexibility in work schedules or hours of work, which is why it is important the Government considers more flexible furlough arrangements. Working from home should continue to be the norm for those who can, for the foreseeable future.

“Business owners must balance their desire for getting their business up and running again with the safeguarding of their people’s health and well-being. Government guidance and health and safety will only go so far; businesses must think about what is needed for their own organisation and the specific needs of their people. We have a long road ahead to get Britain back to work, but by engaging with staff and taking the time to think through workplace protections, businesses will be in a much better position to bring people back at the right time and in the right way.’

Flexible Furlough

On 12 June, the Government released further guidance on how the flexible furlough scheme will operate from 1 July 2020. This scheme is an adaptation to the original Job Retention Scheme, and has been designed as a way to assist employers bring furloughed employees back into work on a  part time basis while still being able to claim financial assistance from the Job Retention Scheme.

What is a flexible furlough?

From 1 July 2020, employers can bring furloughed employees back to work for any amount of time and any work pattern.

You will still be able to claim the furlough grant for the hours your flexibly furloughed employees do not work, compared to the hours they would normally have worked in that period.

How do I put employees on flexible furlough?

From 1 July 2020, only employees that you have successfully claimed a previous grant for will be eligible for more grants under the scheme.

This means they must have previously been furloughed for at least 3 consecutive weeks taking place any time between 1 March and 30 June 2020. For the minimum 3 consecutive week period to be completed by 30 June, the last day an employee could have started furlough for the first time was 10 June.

You should have a discussion with employees who you wish to place on the flexible furlough scheme because you will need to agree the arrangements of their part time work. The agreement should be confirmed in writing and you must keep a written record of the agreement for five years.

You do not need to place all your employees on furlough. In addition, you can continue to fully furlough employees if you wish.

How long can flexible furlough last?

Flexible furlough agreements can last any amount of time. This means that they do not need to last for a minimum of 3 weeks. However, the period that you claim for must be for a minimum period of 7 calendar days. Any flexible furlough period of less than this cannot be claimed for via the scheme.

Employees can enter into a flexible furlough agreement more than once.

What do I pay an employee on flexible furlough?

You will pay the employee for the hours they work, along with national insurance contributions and pension contributions for those hours.

The scheme will allow you to recover the remainder of wages to a maximum cap. Wage caps are proportional to the hours an employee is furloughed. For example, an employee is entitled to 60% of the £2,500 cap if they are placed on furlough for 60% of their usual hours.

The amount that the scheme will cover will begin to decrease from September 2020, and you will be responsible for all of the national insurance and pension contributions from August 2020, regardless of the employee being on flexible furlough.

Claims under the new scheme will be open from 1 July 2020.

When claiming for employees who are flexibly furloughed you should not claim until you are sure of the exact number of hours they will have worked during the claim period. This means that you should claim when you have certainty about the number of hours your employees are working during the claim period. If you claim in advance and your employee works for more hours than you have told HMRC about, then you will have to pay some of the grant back to HMRC.

What records do I need to keep?

You’ll need to keep records of how many hours your employees work and the number of hours they are furloughed during flexible furlough. For example, you will need to record that an employee who normally works for 37 hours a week is actually working for 15 hours and is furloughed for 22 hours.

Can my employees work for me during ‘down time’ in flexible furlough?

During flexible furlough, employees are not allowed to do any work for you or any linked or associated organisation during the periods that you record them as being on furlough.

Employees on flexible furlough can do training during the hours that they are recorded as being on furlough, but must be paid at least national minimum wage for those hours.

How do I calculate normal working hours?

If your employee is flexibly furloughed, you’ll need to work out your employee’s usual hours and record the actual hours they work as well as their furloughed hours for each claim period.

There are two different calculations you can use to work out your employee’s usual hours, depending on whether they work fixed or variable hours.

You should work out work out usual hours for employees who work variable hours, if either:

  • your employee is not contracted to a fixed number of hours
  • your employee’s pay depends on the number of hours they work

Where the employee’s working hours are fixed, or their pay does not vary with the amount of hours worked, the reference period for calculating their hours is the hours your employee was contracted for at the end of the last pay period ending on or before 19 March 2020.

Where an employee works variable hours, you will use the higher of:

  • the average number of hours worked in the tax year 2019 to 2020
  • the corresponding calendar period in the tax year 2019 to 2020.