Coronavirus (COVID-19) – Furlough

The Coronavirus Job Retention Scheme (CJRS) otherwise known as “furlough” is a temporary scheme open to all UK employers and will be running until the end of September 2021. It is designed to support employers whose operations have been affected by the health, social and economic emergency in the UK caused by the coronavirus pandemic. 

Your employer can then claim up to 80% of your usual salary for hours not worked, up to a maximum of £2,500 per month until the end of September 2021. However, in July they will be expected to contribute 10% and in August and September they will be expected to contribute 20%. You will continue to be entitled to 80% in July, August and September.

The furlough scheme has been expanded to allow employees to be furloughed if they are unable to work because of caring responsibilities because of coronavirus, for instance caring for children at home because of closed bubbles and schools or caring for someone who is vulnerable to COVID-19. You can also be furloughed if you are clinically extremely vulnerable and are unable to work from home. See the Government guidance.

While you are on furlough, you remain on your employer’s payroll, but you cannot carry out work for them. Employees that have been furloughed have the same rights as they did previously. That includes maternity rights, other parental rights, rights against unfair dismissal and to redundancy payments.

Flexible furlough means you can be furloughed part time, and work for your employer part time. Under flexible furlough you can work for any amount of time, and in any work pattern i.e. from 1 hour per week, up to your full contractual working hours. This arrangement can vary week by week.  

Remember, if your employer is asking you to change your hours, they need your written agreement and should keep a record of the hours you work and are on furlough.

Your employer can continue to claim the furlough grant for any hours you do not work, compared to your usual hours.

To be eligible for furlough, you can be on any type of employment contract, as long as you’re taxed as an employee and are on PAYE. This includes contracts that are:

• full-time
• part-time
• with an agency
• flexible
• zero-hour

Yes, you can be furloughed if you are clinically extremely vulnerable. This is confirmed in the latest guidance. 

On 1st April 2021, the government lifted the shielding advice. Those who are clinically extremely vulnerable are no longer advised to shield, and can return to work as long as health and safety measures are followed. For more information, see our FAQ page on rights for carers and clinically extremely vulnerable.

If you cannot work from home, you may want to speak to your employer about taking an alternative role that would allow you to work from home and you can ask to be furloughed if you cannot work from home. If you were on furlough for a reason that is unrelated to the fact that you are clinically extremely vulnerable (e.g. your employer did not have work for you), you can also ask your employer to stay on furlough for shielding reasons.

No, but you may be entitled to “special leave”.

If your employer receives public funding which is used for your salary, then your employer may not use the furlough scheme. The government guidance states that if your employer receives public funding for staff costs, and that funding is continuing, employers should continue to pay their staff and not furlough them.

The implication of this is that they should grant you “special leave” for this time and pay you your salary as normal for the time you have had to take off for COVID related reasons. You are in circumstances where you could request to be furloughed (but for the public funding exemption). 

The guidance states that:

Where organisations receive public funding for staff costs we expect employers to pay staff as usual – and correspondingly not furlough them.

Only organisations that are not fully funded by public grants should consider accessing the scheme. Your employer should contact their sponsor department or respective administration for specific queries.

Early years providers remain eligible for the CJRS while continuing to receive early entitlement funding via local authorities. Read the relevant section relating to early years providers is from the government guidance here.

If you work for the NHS, there is information on the NHS approach here.

Yes, you can be furloughed for the first time, even if you have never been furloughed before.

For periods on or after 1 May 2021, your employer can claim for you if you were employed on 2 March 2021, as long as they have made a PAYE submission to HMRC between 20 March 2020 and 2 March 2021.

If you agree with your employer that you will be furloughed, make sure to get confirmation of this in writing, in line with Government guidance for employers. To avoid confusion, it it is best if you could agree, in writing:

1. that your employer will apply to HMRC on your behalf for the Coronavirus Job Retention Scheme;
2. when your employer will apply to the scheme for you;
3. how long you will be furloughed for and the arrangement if you will be flexibly furloughed (this can be extended by agreement); and
4. the exact amount of money that your employer will be applying to the government for on your behalf (i.e. how are they calculating your ‘wages’? This point is especially important if your income varies from month to month).

The written agreement does not have to be formal – you can confirm this via email, text, another messaging service, or more formally by a variation to your contract. It’s just important that it is written down so you can more easily rely on this information in the future if any disagreement arises. 

You can find more information on the government guidance for employees and guidance for employers.

To make a claim for furlough, your employer needs to submit information to HMRC about workers who have been furloughed and their earnings, via the online portal. Your employer should receive payment under the scheme six working days after making the claim. 

Unfortunately, furlough is not an entitlement, and your employer can refuse to furlough you. It is important to make clear to your employer that keeping you on furlough or putting you back on furlough will only have a minor impact on them, as they can continue to claim 80% of your wages under the scheme. Up to the end of June, they do need to pay 5% in national insurance contributions and pension contributions. In July, they need to contribute 10% and in August and September they need to contribute 20%. They can top up your wages, but they do not have to.

See our advice on what to do if your employer refuses to furlough you.

We suggest you stress to your employer how difficult this time is for you and your family, that, provided you are happy to accept 80% of your normal salary, it will not cost them anything over the 10-20% contribution to your wages, national insurance and employer pension contributions. You may want to show them the government guidance which allows you to be furloughed for childcare or caring responsibilities.

If your employer asks you to work part time, they must pay you your wages in full for the hours worked. Your employer will then pay 80% of your wages for any of your hours you do not work. See the section on flexible furlough below for more information.

HMRC has set up a whistleblowing service for workers whose employers are making them work when they are officially on furlough. The whistleblowing scheme allows you to notify HMRC that your employer is breaching the scheme by making you work when you are supposed to be furloughed. You can contact HMRC on their Fraud Reporting line on 0800 788 887 or via their online form. You can also contact Protect, the whistleblowing charity, for advice. There is more information on how to contact them on their website here.

Your employer can also ask you to complete training while you are furloughed. If they do, then they should pay you at least the national minimum wage for the time you are doing the training, even if this means they have to pay you more than the 80% through the furlough scheme.

The government’s guidance says that if you are put on furlough, you can work for another employer during furlough, but only if your contract allows you to (some employment contracts have an exclusivity clause which mean you cannot work for another employer).

Working for another employer will not affect the grant that the employer who has furloughed you can claim under the scheme.

You are not allowed to work while on furlough for an employer or company that is linked to your employer in any way. The work you carry out for the other employer has to be completely separate to the work you normally do.

Bear in mind that you will need to be able to return to work as normal for the employer that has placed you on furlough if they decide to stop furloughing you (or if they want to put you on flexible furlough). You must also be able to undertake any training your employer requires you to do while on furlough.

Yes, while you are on furlough you continue to accrue annual leave as normal.

You can agree with your employer to vary holiday pay entitlement as part of your furlough agreement with them, but your employer should not lower your holiday pay to below 5.6 weeks (pro rata) per year. This is the minimum amount of paid annual leave set out in the Working Time Regulations.

The government announced on 27 March 2020 that where it has not been reasonably practicable for employees to take all of their annual leave due to coronavirus, they can carry up to four weeks of leave over into the next two leave years.

Yes, the government’s guidance on furlough for employees says that you can take annual leave while you are on furlough.

Your employer will need to top up your salary during this time to ensure you are being paid your full salary while you are on annual leave. This means they will need to pay a top up to the furlough grant provided by the government.

Bear in mind that your employer can restrict when leave is taken if there is a business need.

Yes, according to government guidance (this applies in England, Scotland and Wales. See here for the position in Northern Ireland). Your employer can require you to take holiday while you are on furlough.

Your employer has to give you advance notice if they require you to take annual leave. The notice period has to be twice as long as the holiday the employer requires you to take (so if they want you to take a week off, they must give you two weeks’ notice). 

Taking holiday will not disrupt your period of furlough. Your employer must pay you your full wages while you are taking holiday, even if you have agreed to reduced pay as part of your furlough agreement.

The government guidance says your employer should consider whether any restrictions you are under might prevent you from resting, relaxing and enjoying leisure time – this is the purpose of holiday. Needing to socially distance from others, or self-isolate, or teach your children while the schools are closed, may prevent you from doing this while you are off work.

If your employer asks you to take holiday when you don’t want to, you should explain your reasons to them, and ask to save your holiday for another time. You should set out why, in your current circumstances, any holiday taken would not allow you to rest, relax and enjoy leisure time. You could point out to them that the government is allowing employees to carry over up to four weeks of leave into the next two years, because of coronavirus, to give businesses more flexibility. Any holiday which you don’t take now can be taken in the next two leave years.

We have created a separate page on returning to work, including your right to refuse to return to work for childcare, caring, or health and safety reasons.

Furlough pay is calculated based on 80% of your usual wages. If you are fully furloughed, your employer does not need to consider your usual hours worked. If you are flexibly furloughed, your employer should consider your usual hours against your actual hours to calculate your furlough pay.

Furlough pay calculation depends on whether you are on fixed salary or your salary varies every pay period. For employees with fixed pay, your employer should work out 80% of your usual wage by looking at the wages payable to you in the last pay period ending on or before your ‘reference date’ – this is 19 March 2020, 20 October 2020 or 2 March 2021, depending on various factors. See the government guidance for more information.

If you are an employee on variable hours/pay, how your furlough pay should be calculated depends on your ‘reference date’. See the government guidance for more information on calculating your reference date.

For employees with a reference date of 19 March 2020, calculate 80% of the higher of the:

• wages earned in the same calendar period in the previous year
• average wages payable in the tax year 2019 to 2020

If you have a reference date of 30 October 2020, your employer should calculate 80% of the average wages payable between 6 April 2020 and the day before you were first furloughed on or after 1 November 2020.

If you have a reference date of 2 March 2021, your employer should calculate 80% of the average wages payable between 6 April 2020 and the date before you were first furloughed on or after 1 May 2021.

Furlough pay calculation depends on whether you are on fixed salary or your salary varies every month/week.

If you are an employee on fixed pay and with fixed hours, your furlough should be calculated at 80% of your usual earnings. This is your usual salary, and not the pay you received whilst on maternity leave,  parental leave, shared parental leave, paternity leave or adoption leave. Your employer should also not consider any periods of unpaid leave.

For claim periods starting on or after 1 May 2021, when employers calculate the average wages for employees on variable pay, they should not include days during, or wages related to a period of family-related statutory leave or reduced rate paid leave following a period of family related statutory leave.

Unfortunately, if your employer is using the calendar lookback method (wages earned in the same period in the previous year), then this would be based on the amount that you earned even if you were on a period of statutory leave.

But note that your employer should be using the method that produces the higher amount, so you should ask your employer to use the higher one.

If your employer has questions, you can encourage them to reach out to the HRMC support service for employers on the furlough scheme: Get help with the Coronavirus Job Retention Scheme. Unfortunately, this service is available only for employers and not employees.

If you have not been paid the correct furlough pay, your employer can amend their claim by contacting HMRC.

You should speak to your employer to try to resolve the issue in the first instance. If you cannot resolve the issue and you are still owed extra payment, you may have a claim for unauthorised deduction of wages in an employment tribunal. There is a time limit of three months from the date of payment or series of payments and you should seek further advice from ACAS.

If you are taking holidays or completing training for your employer during your furlough period, you are entitled to 100% pay for these periods, even if you have agreed to reduced pay as part of your furlough agreement.

If your employer has asked to put you on furlough, but you are “ready, willing, and able” to work, you have a right to your full contractual pay. Until the end of June 2021, your employer can only recover up to 80% of your wages (up to £2,500 per month) through the furlough scheme. From July, you will continue to be entitled to 80% in July, August and September, but employers will be expected to contribute 10% and in August and September they will be expected to contribute 20%. The scheme does not change existing employment law. If your employer asks you to go on furlough, you do not have to agree to a reduction in pay – just as you do not have to agree to furlough.

If you refuse furlough, your employer may explain that they need to make you redundant. In this situation, it may make more sense to accept 80% of your salary to avoid redundancy. But if your employer wants to make staff redundant, they must follow normal redundancy rules. There will have to be a genuine redundancy situation, and they must follow a fair selection criteria. See our page on redundancy during coronavirus for more information.

If you have asked your employer to put you on furlough because:

• you cannot continue working for childcare or caring reasons; or
• you cannot continue working because you are shielding or someone in your household is shielding,

then it will be more difficult for you to argue that you should be paid your full pay. This is because being entitled to full pay depends on being “ready, willing, and able” to work. If you are furloughed because you have said that you cannot continue working (for childcare, caring, or shielding reasons), you are not ready, willing or able to work. In this case, you may be more inclined to accept a 20% pay cut and receive only 80% of your pay while you are on furlough.

Yes they can. The government have confirmed in their guidance on the Coronavirus Job Retention Scheme that because employees are only entitled to the national minimum wage (NMW) for the hours they actually work, furloughed workers may be paid below this threshold.

But if your employer asks you to do some training during the time you are furloughed, then they should pay you at least the NMW for the time you are doing the training, even if this means they have to pay you more than the 80% that will be reimbursed by the government. Remember that you are not supposed to work when you are furloughed but your employer can ask you to complete training.

There are some advantages to agreeing to your employer’s proposal. It will mean you have a continued (though reduced) income. The risk is that if you refuse your employer’s proposal, you could be made redundant.

When deciding who to bring back to work, your employer should consider which roles are needed, and whether any staff should be kept on furlough because they are unable to work (for example, because they or someone else in their household is vulnerable, or they have no childcare).

Remember, you do not have a right to be furloughed – your employer can refuse to keep you on furlough, and ask you to return to work. See our page on return to work and health and safety for what to do in that situation.

Your employer also cannot discriminate on the basis of any protected characteristics, like sex, maternity or age. They must decide on who to ask to return to work in a fair and non-discriminatory way. There is more information on discrimination relating to furlough below and on our separate discrimination advice page.

Your employer may have to give you notice to ask you to come back to work. When you were furloughed, you should have entered into a written agreement with your employer to be furloughed. You should check this carefully, to see if your employer has to give you notice, and the length of this notice. If this agreement doesn’t say that your employer has to give you a certain period of notice, then your employer should give a reasonable amount of notice.

You do not have a right to be furloughed – your employer can refuse to keep you on furlough, and ask you to return to work. See our page on return to work and health and safety for what to do in that situation.

If you have childcare and/or caring responsibilities and your employer refuses to place you on furlough or flexible furlough, please see our information sheet on what to do if your employer refuses to furlough you.

If you have 26 weeks’ service for your employer, you could also make a flexible working request. However, your employer has 3 months to consider this request, so it may not be an immediate solution. Note that flexible working rules are different in Northern Ireland. There is more information on requesting flexible working on our webpage on the topic. We also have a template letter for requesting flexible working during coronavirus.

If you work part-time on flexible furlough, this will not permanently change your employment contract, unless you and your employer agree that these part-time hours will be your hours when you return to work at the end of furlough. You should check the terms of any flexible furlough agreement your employer gives you carefully, to see how long the change to your hours could last.

If you would like to stay on your part-time hours after the furlough scheme ends on 30 September 2021, you should speak to your employer about this.

If you have 26 weeks’ service for your employer, you could also make a flexible working request. However, your employer has 3 months to consider this request, so it may not be an immediate solution. Note that flexible working rules are different in Northern Ireland. There is more information on requesting flexible working on our webpage on the topic. We also have a template letter for requesting flexible working during coronavirus.

There is more information on our advice page on the law when your employer asks you to change your hours

The government guidance in relation to the furlough scheme states that:-

When employers are making decisions in relation to the process, including deciding who to offer furlough to, equality and discrimination laws will apply in the usual way.

Under the Equality Act 2010, It could be discrimination if you are not furloughed just because:

• You are pregnant (pregnancy discrimination)
• You are on maternity leave (maternity discrimination), although if you want to return early from maternity leave to be furloughed, you will need to give your employer 8 weeks notice and cannot be furloughed before this
• You have a disability (disability discrimination)
• You are the carer of someone with a disability (direct disability discrimination by association)
• Your age (age discrimination)
• You work part-time
• You are on a fixed term contract
• Of your sex or another protected characteristic

Similarly it could also potentially be unlawful discrimination to select an employee to be furloughed based on any of the protective characteristics.

Sex Discrimination and/or Pregnancy or Maternity Discrimination

It could be argued that an employer’s policy to refuse to furlough employees will have a disproportionate impact on women and could amount to indirect sex discrimination under section 19 of the Equality Act 2010. Indirect sex discrimination is where an employer unjustifiably applies a general rule (eg no furlough) which puts women (more than men) at a particular disadvantage. This is because women still tend to have the greater share of childcare obligations.  Men cannot usually claim indirect sex discrimination, because this concept depends on showing that one gender (in this case, women) tends to be disadvantaged more than the other by the employer’s rule. 

Also, if you have taken family-related leave (maternity leave, adoption leave, shared parental leave, paternity leave, parental leave, or time off for dependants) then you have a right not to be treated unfavourably as a result. So if you were not furloughed purely as a result of you taking or intending to take family-related leave then this may be unlawful.

If your employer fails to notify you about furlough just because you are on family-related leave or because of one of the discriminatory reasons above, this could also be a breach of your contract – more specifically, the implied breach of trust and confidence.

Disability Discrimination

If you are disabled in accordance with the Equality Act 2010, a decision not to furlough you could be unlawful disability discrimination.

What constitutes a ‘disability’?

Under the Equality Act, a person has a disability if he or she has a physical or mental impairment and the impairment has a substantial and long-term adverse effect on his or her ability to carry out normal day-to-day activities. There are therefore several elements to satisfy in order to demonstrate disability. These are:

i) Impairment that is physical or mental
ii) Impairment must be substantial
iii) It must have an adverse effect
iv) That adverse effect must be long-term
v) On day to day activities

If you are shielding and classed as clinically extremely vulnerable you will more than likely have a disability for the purposes of the Equality Act  and you may therefore have additional protections under under disability discrimination law.  However, not all who are in the “clinically vulnerable” category will be disabled, some will have a disability but many won’t.

You may qualify as disabled due to the impact of Covid-19 even if your condition wouldn’t normally be covered by the Equality Act, this is because Tribunals will need to take into account the impact of Covid-19 when deciding whether someone who is clinically vulnerable qualifies as being disabled under the Equality Act 2010.  Workers may be able to argue that a physical impairment that makes them vulnerable to Covid-19, now should be viewed as a substantially adverse effect on their ability to carry out normal day-to-day activities, because of the need to take steps to avoid infection. 

Discrimination arising from disability

An employer discriminates against a disabled person if the employer treats them unfavourably because of ‘something arising in consequence’ of their disability and the employer is unable to show that the treatment is a proportionate means of achieving a legitimate aim.

It could be argued that if your employer refuses to furlough you because you are shielding and are to entitled  SSP, you may be able to argue that you have been subjected to  unfavourable treatment (the reduction in pay) and have claims under health and safety and disability discrimination .

Whether or not treatment amounts to unfavourable treatment will depend on the circumstances of each individual case. 

Reasonable adjustments

Employer’s also have a duty to make reasonable adjustments under the Equality Act.  If a general rule (known as a ‘provision, criterion or practice’), puts a disabled person at a substantial disadvantage compared with non-disabled employees, the employer has a duty to take reasonable steps to avoid that disadvantage.  If your employer has a policy not to furlough, this could be a general rule which puts a disabled person at a substantial disadvantage compared to non disabled employees and in this case, it could be argued that placing you on furlough could be a reasonable adjustment.

Indirect Discrimination

Indirect discrimination happens where an employer applies a provision, criterion or practice (PCP) to their employees (eg, a policy not to furlough) , and this places employees with the disability at a particular disadvantage, when compared to other (non disabled) employees. If an employer cannot justify the PCP to be a proportionate means of achieving a legitimate aim, it could  be indirectly discriminatory. It could therefore be argued that a blanket policy not to allow furlough could be unlawful indirect disability discrimination. 

Disability Discrimination by association 

Direct discrimination is when an employer treats their employee less favourably because of a protected characteristic. However, this can also occur when an employer treats an employee less favourably because of their association with a person with a protected characteristic, as opposed to the employee having a protected characteristic. This could apply to a parent, partner, child or carer of a shielded person for example. 

It is difficult to see how direct associative disability  discrimination would apply to decisions whether or not to furlough someone. However, it could be argued that a blanket rule not to furlough, places relatives or carers of shielding individuals at a particular disadvantage and could therefore amount to indirect discrimination by association, However, whether or not indirect discrimination applies to disability discrimination by association in the UK  is very unclear at the moment and is untested in the UK courts.

Strength of discrimination arguments in relation to furlough decisions

It is  important to remember that all of these arguments in relation to furlough decisions are, as yet untested in the courts and until then, it is impossible to know whether or not these arguments would be successful. In any event, each case would depend on its own facts. 

Furthermore, in relation to indirect discrimination claims, employers can argue that the alleged discriminatory act (eg a blanket policy not to furlough)  can be justified as a proportionate means of achieving a legitimate aim. Legitimate aims could include meeting business demands or ensuring adequate staffing levels. 

Bringing Employment Tribunal claims can be stressful, time consuming and complex and should only be considered as a last resort.

We would recommend that you seek specialist legal advice if you are considering submitting a claim. You should be aware that there are strict time limitations to bring a claim, and generally a claim must be brought within three months less a day from the act complained of (e.g. for discrimination, you must be a claim within three months less a day of the act of discrimination). You can find more information on starting a claim here.  

If your employer has agreed to furlough you and has money to be able to continue to pay you as furloughed, they should do so. They can then reclaim these payments through the Coronavirus Job Retention Scheme subject to the time limits in which they need to submit a claim to HMRC.

If your employer had agreed to apply to the Coronavirus Job Retention Scheme for you, and they later refuse to do so, you may be able to argue that this is a breach of your contractual agreement and potentially unlawful deduction of wages (see below).

Has your employer told you why they have not given you your furlough pay? Are they waiting to receive funds from HMRC? Have they received these funds, but are withholding them from you? Understanding this will help you decide what to do next.

Your first step should be to ask your employer to pay you. If they are still refusing to do so, you should consider the legal arguments below.

Check the written agreement with your employer. When you were furloughed, your employer should have confirmed this agreement in writing. You should check this written agreement carefully – it may have been a letter, or an email. In it, your employer should say that they will pay you while you are on furlough. You should point this out to your employer and attempt to resolve the matter with them first.

Even if you do not have a written agreement with your employer, they should be paying you while you are on furlough. Their failure to pay you may be a breach of contract. However, even if successful, this claim often only results in a small amount of compensation (probably not more than the financial sum you would have received had you been furloughed). Claims for breach of contract cannot be made in an Employment Tribunal unless your employment has ended. You can make a claim for breach of contract in the County Court without leaving your job, but if you do this there is a risk that you will be ordered to pay your employer’s legal fees if you lose the case.

You may also have a claim for unlawful deduction from wages. A “deduction” of wages includes late payment. You do not have to be an employee to bring a claim for unlawful deduction of wages – it also applies to workers. There is no minimum length of time you must have worked for your employer for to bring a claim for unlawful deduction from wages. Bringing a claim for unlawful deduction of wages may be preferable to bringing a claim for breach of contract because you can claim your wages at the Employment Tribunal while still working for your employer. You can only bring a claim for breach of contract at the Employment Tribunal if your employment has ended.

Your employer can argue that the deduction of wages is not unlawful if it is covered in your employment contract, or if you have agreed to the deduction in writing. You should check your employment contract carefully – does it allow your employer to reduce your pay like this? You should also make it clear in your communications with your employer that you do not consent to them withholding your furlough pay.

If you are considering bringing a claim, you must seek legal advice. There are strict time limits at the Employment Tribunal – you must bring your claim within three months of your employer failing to pay you. If your employer continues to withhold your pay, the 3-month time limit for making a claim could run from the last date on which your employer refused payment.

If you are successful in a claim for unlawful deduction from wages, the Employment Tribunal will order your employer to pay the amount you were supposed to receive. They may also award you an appropriate sum for any financial loss caused by the late payment (for example, overdraft fees).

There is more information about bringing a claim at the Employment Tribunal on our webpages.

If your employer is refusing to pay you on furlough but they are claiming your furlough pay from the government, you can contact HMRC to report this: If you have concerns about whistleblowing, you can contact Protect, a specialist whistleblowing organisation, for advice.

We have created a number of articles on topics relating to coronavirus. These are linked at the very top of this page.

To find out what government schemes will help if your work has been affected by COVID-19, Child Poverty Action Group (CPAG) have created a decision tree to help you navigate what you may be entitled to, including whether you are eligible to be furloughed.

Links to further resources:

• Official government guidance on furlough for employees
• Official government guidance on furlough for employers
• Government guidance on calculating 80% of employees’ wages for furlough
• Official guidance on furlough for educational providers
• If you have a union, you can contact them for support