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COVID-19: Furlough scheme could lead to ‘mass litigation'

29 April 2020
Issue: 7885 / Categories: Legal News , Covid-19 , Employment
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‘Mass litigation post-pandemic’ could be brought unless the government addresses ‘significant flaws’ in its furlough scheme, employment lawyers have warned
Under the Job Retention scheme etc the government pays up to 80% of salary of each furloughed worker, up to a maximum of £2,500 per month for three months.

However, the Employment Law Association (ELA) has highlighted ‘significant flaws’ in the system, which could leave both employer and employee vulnerable, in a letter to the Department of Business, Energy and Industrial Strategy (BEIS) this week.

According to the letter, an ELA working party has identified ‘gaps in the scheme and conflicting government guidance’, which could result in claims being issued in the employment tribunal. Its questions concern redundancy, annual leave and employee representatives.

The questions include: whether acting as an employee representative constitutes ‘work’ for the purposes of furlough, and therefore breaks the furlough period and makes them ineligible for government support?

The working party also asks: can an employer commence collective consultation on proposed redundancies while employees are on furlough leave? Does an employer have to collectively consult when initiating furlough scheme and if so, when? And, can an employer force an employee to take annual leave during furlough?

Paul McFarlane, chair of ELA’s legislative & policy committee, said: ‘It’s essential that the government responds to this paper and provides clarity on the gaps in their guidance which currently places employers and employees in a vulnerable position.

‘Whilst we navigate through these uncharted waters, support is needed and those most vulnerable must be protected, which is why clear guidance is so important. The working party has identified a number of areas where conflicting guidance is given and urge the government to be transparent so employers are protected from litigation down the line.’

Issue: 7885 / Categories: Legal News , Covid-19 , Employment
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