Flexible Furlough Scheme – important Direction re holidays

On 12 June the government updated its Coronavirus Job Retention Scheme guidance to refer to more flexible furlough scheme from 01 July.  The Chancellor of the Exchequer has issued a the CJRS Treasury Direction which, in law, will override looser language in the guidance.

Holidays

There do not appear to be any rules directly constraining periods of annual leave being designated as periods of furlough.

Perhaps the only question for any employer is whether claims against periods of annual leave fall within the purpose of the scheme.  In particular, are the furlough payments being used to continue the employment of those for whom the claim is made whose activities have been adversely affected by the government response to Coronavirus?

The precise wording is much longer but that seems to be the key issue.

If (a) the activities the employee undertakes (making widgets) are adversely affected (we need to make fewer ), and (b) a reasonable argument is if we don’t have cushion for costs of employment, including covering holidays, then their continued employment could be at risk, then it would seem there is good reason why holidays can be claimed.

The Flexible Furlough Scheme direction

There is nothing new here of significance.

We set out further  details in an earlier post when the scheme was announced.