The question every employer is asking right now especially with the double Easter bank holiday weekend looming. The Government introduced the Job Retention Scheme, allowing employers during the current COVID-19 crisis to place their workers onto a period ‘furlough’.
As you are probably aware by now, the term furlough has no legal definition here in the UK and it is more frequently encountered in the USA. There, it is a temporary suspension of employment for a special period of time, during which a worker does not receive wages.
This is our first encounter with furlough, and we are all trying to get our heads around it. What we do know is that in order for employers to qualify for the payment, workers must be furloughed for a minimum of three weeks at a time.
This element of the scheme could imply that potentially during the period of furlough, holidays cannot be taken. Especially when combined with the recent announcement of The Working Time (Coronavirus) (Amendment) Regulations 2020 which will allow workers to be able to carry over up to four weeks of their annual leave entitlement into the next two leave years if their taking of annual leave has been affected by the Coronavirus outbreak.
That said, annual leave is provided to workers in order for them to get enough rest and keep fit and healthy (mentally and physically) away from work. During the period of furlough, a worker would not be undertaking any work which is the same position as if they were on annual leave, potentially resulting in furlough and annual leave being compatible.
Acas has provided some guidance on bank holidays stating “Employees and workers may still be required to use a day’s paid holiday for bank holidays, including when they’re furloughed.” However, nowhere in the job retention scheme guidance does it provide clarity on the position of holiday and furlough.
Employers ought to tread carefully around this subject especially with the lack of information from the Government. Therefore, our advice here at CoLaw is to be pragmatic and not to do anything which could ultimately disqualify you from receiving the reimbursement. In the absence of any clear legal clarification, employers have two choices;
- where bank holidays are normally a non-working day and time off under the holiday rules would normally be provided – allocate a day’s leave and ensure the employee is receipt of full-pay for any bank holiday that falls during a period of furlough
- do not require the employee to take any leave during a period of furlough leave – instead allow for any bank holidays to be taken at another point during the leave year (see paragraph below) or agree for it to be carried forward under the The Working Time (Coronavirus) (Amendment) Regulations 2020.
A practical approach for employers to consider would be alternating between a period of furlough and holiday, for example, three weeks of furlough, one week of annual leave and so on and so forth.
Legally, there is a requirement for you to provide workers with notice to ‘force’ them to take annual leave. Employers must give twice as many days’ notice as the number of days that they want a worker to take as annual leave. For example, if you want your worker to take five days annual leave, you will need to provide ten days’ notice. (However, if your worker consents to taking annual leave the legal notice will not be required.)
Our advice on these matters can change daily and is subject to government guidance, therefore, it is best to reach out to us so we can ensure you are provided with the most up to date information!