Below are some of the issues and questions which you might be impacting your business in light of the current Coronavirus outbreak. This summary is based on current Public Health England and government advice as at 29 March 2020. The advice and messaging around the Coronavirus (or COVID-19), is changing rapidly. The main themes are be vigilant, prepare and be flexible (as you can be) in this developing situation. It is important to check government websites as well as take specific legal advice. This guide is based on employers and employees; although, some advice will apply to your total workforce as well as to your customers and guests. This guide is spilt as follows:
Part 4 - pay, continuing work, “furlough” – the (new) future workplace need
Part 4 – pay, continuing work, “furlough” – the (new) future need
Sickness absence – medical certification
Medical evidence is not required for the first 7 days of sickness. Providing a Dr’s sick note is going to be difficult as employees are being advised not to go to the GP if they have suspected Covid-19. However, the government have launched an online Self-Isolation sick note for those who are medically self-isolating. Employees will need to answer some questions about their symptoms. A system will be in place for those who do not have online access. This form can then be sent to the employer so that they can receive SPP and/or employer sick pay. Keep in contact with the employee to assess their situation and the wider risks to your workforce. Assess the genuineness of the isolation as best you can. Again, if they employee is voluntarily self-isolating, a sensible approach might be to allow them to self-certify for absences of 7+ calendar days.
A word about medical information and data protection. Information about medical conditions and health is “special category” data. Think about who has access to this information and do they? What do your Privacy Notices say about this type of data? How can we ensure the privacy of our staff, clients and guests? Balance the rights of privacy against the business need to take action.
What do we have to pay staff during periods of self-isolation?
Statutory Sick Pay - Employees (and potentially other workers) earning more than the statutory amount per week, who are genuinely ill and who can (if possible) comply with absence notification and sickness notes rules are entitled to be paid Statutory Sick Pay (SSP). The government have announced that those who are self-isolating following professional advice would also be entitled to SSP from day 1 and not day 4 where they have been issued with a self-isolation notice by PHE or through NHS111. This change does not apply (at present) where employees voluntarily self-isolate or are asked to do so by their employer. In the Budget (11 March), the Treasury announced that for businesses with fewer than 250 employees, the cost of providing 14 days of statutory sick pay per employee will be refunded by the government in full.
Employer sick pay – the position with regard to entitlement to employer sick pay where an employee is either professionally self-isolating has been made clearer with the introduction of the self-isolation sick notes. If the employee complies with this new sick note and your notification rules, they would be entitled to employer sick pay. Similarly, if the employee is self-isolating on the employer’s advice then ACAS recommends the employee still be paid. However, if someone is simply self-isolating of their own volition and couldn’t complete the new online sick note, they would not be entitled to sick pay. Ultimately, it would be at the employer’s discretion whether to pay and such discretion should be used consistently and fairly, remembering that employers will not want people coming into work and spreading the virus so pragmatically, and perhaps sensibly, employees voluntarily self-isolating should be entitled to sick/other pay. The Health Secretary has said that isolation should be treated as sick leave for employment law purposes.
What if someone self-isolating can still work? If the employee is able to work remotely, they will be entitled to their usual pay, but be aware of their symptoms, particularly if they do start showing symptoms.
Employees who are ill with the virus - would be treated under normal sick pay rules be this Statutory Sick Pay (SSP) and/or employer sick pay. The same is true if they have symptoms of the virus but have not been diagnosed. Where employers have the right to pay discretionary sick pay, it should exercise this discretion fairly and consistently. Employees should complete the self-isolation form.
What about pregnant employees? Pregnant women are at particular risk and are on the government’s list of vulnerable people who should be working from home and avoiding non-essential travel. Risks assessments should be carried out. Discuss working from home with your employee and make adjustments to her role to allow this. If the employee can work they should be paid as usual. It is unclear if the employee cannot work from home, whether they would be entitled to SSP. They could take paid holiday? It may also have to consider suitable alternative employment on a temporary basis to avoid the risks medical suspension (see below). If the period of suspension/risk lasts until 4 weeks before the baby is born, the employee would take their maternity leave early.
What about medical suspensions? An employer can suspend an employee from work if their health and safety is in danger because of the virus. This is particularly so with pregnant women. Before an employee can be suspended the employer must review the health risks and undertake a risk assessment. There are additional rules before an employer can suspend employees who could become pregnant, are pregnant, gave birth less than 6 months ago or who are breastfeeding. If there are no alternatives to medical suspension (e.g. home working), the employee is suspended on employee on full pay. This will last as long as the employee, or their baby, is in danger. This right is only for up to 26 weeks, as long as they’ve been in their job for a month or more. Medical suspension is not the same as SSP. The employee does not have to be signed off by a GP. Employers should deduct tax and National Insurance through payroll in the normal way.
Employees will not have the right to pay if they:
- are an independent contractor or agency worker
- refuse other suitable work from their employer without a good reason
- are not available when needed for suitable alternative work
What about those with underlying conditions/high risk who are told to self-isolate or shield for 12 weeks? The NHS has written to certain high risks individuals and told them to take more restrictive self-isolating measures to protect themselves (shielding). As well as employers having to take greater care of those who have underlying conditions, think about whether such employees can work from home or flex their working day/roles? In terms of what they should be paid, the Statutory Sick Pay (General) (Coronavirus Amendment) Regulations 2020, make clear that qualifying employees who isolate themselves on the basis of advice published by Public Health England (or the devolved health authorities) will be entitled to SSP. The regulations only apply if a person is unable to work because of self-isolation. An employee who works from home should be entitled to be paid their wages. Employees who are shielding can also be placed on Furlough leave and claim a grant under the new Job Retention Scheme
Will self-employed or zero hours workers get sick pay?
Broadly speaking, only employees are entitled to sick pay and self-employed people or those on zero-hours contracts are not; although the Treasury have announced (in the March Budget) that help for the self-employed and also for businesses with less than 250 employees will be offered in relation to sick pay. The government have said that those not eligible to receive sick pay, including those on zero hour contracts, working in the gig economy, or self-employed, are able to claim Universal Credit and/or contributory Employment and Support Allowance. For those on a low income and already claiming Universal Credit, it is designed to automatically adjust depending on people’s earnings or other income. Help for the self-employed have also been announced https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme
What about the "Coronavirus Job Retention Scheme"
“Coronavirus Job Retention Scheme” - The Government will pay the wages of employees unable to work due to the coronavirus pandemic. It will pay 80% of their wages up to £2500 (capped) a month. Employers can, if they choose top up the employees’ wages. Employers will have to designate those employees who would otherwise have been laid off or have been made redundant because of the Covid-19 crisis and designate them as “Furloughed workers”. The definition of furlough is to allow or force someone being absent temporarily form work.
The “grant” is to be backdated to the beginning of March and will last for three months. The scheme will be extended further “if necessary”. Employees have to have been employed as at 28 February 2020 and the employer must have had a PAYE scheme established as at 28 February 2020 AND have a UK bank account for the grants to be paid. The Chancellor, indicated that HMRC would administer the scheme and that it was hoped to have the first payments being made in weeks i.e. in April.
What do we know about the Coronavirus Job Retention Scheme for furlough employees?
- It applies to all UK businesses;
- It will apply to full time, part-time and flexible zero hours employees;
- Employers will need to designate employees as “furloughed workers”;
- Employers will need to notify the employees they are furloughed and not therefore required to work;
- Furlough must last for an initial period of 3 weeks (claims can be made every 3 weeks);
- Employers will need to comply with existing employment law when changing an employee’s status;
- Employers will need to submit information to HMRC of the workers’ wage costs up to a cap of £2,500 a month through a new online portal;
- HMRC will reimburse 80% of furloughed worker’s wage costs. The Scheme will allow employers to claim 80% of [an employee’s] wage for all employment costs (caped at £2,500 plus Employer NICs plus minimum auto enrolments pension contributions on qualifying earnings;
- Special rules apply when the employee has variable pay;
- Employers are not required to top up an employee’s wage;
- The system for reimbursement is being set up (including the online portal).
The payment of employees’ wages, where they have been placed on furlough provides an opportunity for businesses to pause and assess what the situation is more calmly. The scheme is clear it only applies to those employees who are furloughed. The position of those employees, who are sick, would appear to be that they are sick and either receives company sick pay or SSP. Equally those on statutory maternity (or other family) leave would continue on maternity leave. Although it is unclear how HMRC will police the new scheme.
Where some employees have work and others do not and are placed on furlough, unless there is a contractual right not to pay an employee, the employee will need to consent, to prevent an unlawful deductions claim. It may also be necessary to select the employees fairly, to avoid later claims of repudiatory breach and unfair dismissal. Some employees may insist that they have a right to work and not be furloughed, and could be awkward. That may result either in them working or redundancy/dismissal for SOSR for failing to comply with a reasonable management request.
The measures are aimed at preventing a wave of redundancies similar to the 2009 financial crash in an attempt to help business bounce back from the Covid 19 crisis and to avoid social dislocation.
What happens with the new school closure rules – is this emergency leave and do we have to pay employees?
Schools and nurseries have been closed for the majority of children from Friday 20 March 2020. In these circumstances, this would qualify as an unexpected event or an emergency under statutory emergency leave provisions. Although employees would be entitled to leave to provide emergency care, there's no statutory right to be paid for this time off, but some employers might offer pay depending on the contract or workplace policy. The amount of time off an employee takes to look after someone must also be “reasonable”; however, for most employees, they may have to provide care themselves as there is no alternative. In these circumstances, look for homeworking opportunities (see below) – as recommended by the government – or flexible working patterns to accommodate both working time and looking after children. If the employee is working, they should be paid.
Zero hours workers are not entitled to take emergency leave. They would need to negotiate with the Company as to what will happen in these circumstances and whether there is an opportunity to change shifts or working patterns to accommodate caring responsibilities.
Can we use lay off/short time working, what do we need to be aware of?
Some contracts of employment (or collective/national agreements), may have the right to put employees on “lay-off” or “short-time” (LOST). There may also be a custom and practice within your business of using LOST which you may be able to rely on. A lay-off situation arises where the employer is unable to provide work, but this if temporary. A short-time situation arises where, due to a reduction in the amount of work to be done, weekly pay or working hours are reduced. The key is that both are temporary. Before placing any employee on LOST, they must be notified before the reduction starts. Employees who are laid off and are not entitled to their usual pay might be entitled to a 'statutory guarantee payment' of up to £29 a day from their employer. This is limited to a maximum of 5 days in any period of 3 months. On days when a guarantee payment is not payable, employees might be able to claim Jobseekers Allowance from Jobcentre Plus. Employees can claim statutory redundancy pay if they have been placed on LOST for four weeks in a row, or a total of six weeks in any 13-week period and are earning less than half their usual weeks’ pay. There are complicated rules around the redundancy aspect of LOST so take advice.
In the absence of a contractual LOST provision, employers would not be able to enforce LOST without the employee’s consent. To try and enforce LOST could lead to complaints and claims. If employers do close the place of work, employees would still need to be paid unless an alternative could be agreed which we discuss in this guide.
Think about alternatives to closing for example: home working, flexible working and using holidays.
If employees are on LOST keep in touch with them to make sure they know what the situation is and what may/may not happen to their job.
What about redundancies?
If there is a risk of redundancy (e.g. place of work closing or a reduction in need for workers to do work of a particular kind), then statutory rules and processes will need to be followed. For individual redundancies, those over 2 years’ service have the right not to be unfairly dismissed and whilst redundancy is a potentially fair reason to dismiss, we must also think about consultation and following as fair a process as we can in the circumstances. This is particularly the case if the numbers of proposed redundancies could be 20 or more within a period of 90 days. There may be an opportunity to rely on “special circumstances” as a defence for failing to following statutory collective consultation rules to avoid claims for the protective award. We are advising clients to offer employees on furlough the chance to elect staff reps if they so wish to at least start the process. Employers are still advised to complete form HR1. However, the advice if redundancies are a possibility for your business is to take specific advice in such circumstances; however, if employers are furloughing 20+ employees or it could be that 20+ could be at risk of redundancy in future months, they are advised to complete form HR1 as a minimum.
What about home working? Can we enforce this?
For some businesses, encouraging homeworking could be an option to keep businesses operating at some level. The government are encouraging all people to work from home.
For some businesses, encouraging homeworking could be an option to keep businesses operating at some level. The government are encouraging all people to work from home.
If your business is considering asking employees to work from home, in the first instance check your contracts of employment to see if indeed there is a MOBILITY CLAUSE or some flexibility to change the place of work. Even in the absence of such a clause, could change the place of work if it was reasonable to do so. In the current climate this would be reasonable. Remember requiring home working only changes the place of work, all other terms and conditions remain the same. Whilst home working, employees (and other workers) would continue to be paid in accordance with their contracts.
If you are thinking about home working, there are some issues to consider:
- Health and safety obligations - these still continue so ask employees to confirm their working environment is safe and appropriate.
- Home working is not going to work for every employee or every role so again work with your leaders and also your people to see if home working is viable, whether it could work if the employee had some equipment or modification to their current job.
- Is there any set-off against travel costs v costs of electricity or printing. Can you help out in these situations?
- Security or information, the risks of data leaks – what measures can be put in place?
- Encouraging your people to interact with each other during this time – some will be feeling anxious and isolated. Maybe trial the technology to see if using video conferencing is a way of engaging with your people.
- Introduce a Home Working Policy to set the boundaries of work and the expectations, particularly around working hours inputs/outputs.
Also, think about training – what about webinars, podcasts or online training options. With a captured audience at home, maybe now is the time to brush up on some equality and diversity training.
What about changing hours of work – or any contract terms?
Whilst most contracts of employment should allow some flexibility in changing hours or other terms, for business need there is a fine line between what is a reasonable change and when the change starts impacting on core issues such as employee pay as well as the fundamentals of the job itself.
If the job or contract of employment changes so much that it is unrecognisable, this could in fact be a redundancy situation as the original job will cease to exist so employers need to be aware of this and follow the guidance above concerning redundancy, especially if the numbers affected are over 20.
If the proposed reduction in hours impacts on staff pay, then the employer will need to consult about the change in the hope that employees will agree to it.
A couple of things to say here:
- Firstly, if you are proposing to reduce hours and therefore pay, the National Living and Minimum wages (NM/LW) still apply
- Secondly, what if the employee refuses to accept the contractual change. This is a tricky one as if the employee will not accept the contractual change then the employer’s final move would be – after consulting with the employee – to dismiss them giving notice in accordance with their current contract and offer the new revised terms to commence immediately after notice. The employee could of course refuse and claim unfair dismissal, resign and claim constructive dismissal or perhaps unlawful deductions from wages but in these uncertain times working with your people openly and explaining the situation honestly is the best policy.
Remember too that when we talk about consultation be it on proposing changes to job role, hours, location etc.; this is not negotiation but a genuine attempt in the circumstances to reach agreement with your people. How long should a consultation period be? Usually we would say as long enough so it is fair; however, in these difficult and fast moving economic times this could be more along the lines of “how long do you have to reasonably have?” The advice is to go through some consultation process and keep records of your decisions/consultations to be able to demonstrate the business reasons for the proposed change and the consultation period. [NB. This advice would differ in collective/individual redundancy.]
For some of our more senior employees, employers may not want to be accused of breaching contracts of employment particularly if they are subject to any post termination restrictions.
Can employees cancel their pre-approved holiday requests?
No, not unless the employer says yes. But do employers want employees to cancel? The risk is that employees will not take any holiday only then to take holidays when travel bans are lifted, when this might not be convenient to the employer. If instead, the employee is unwell and cannot travel, they are able to rebook their EU holiday entitlement (20 days) at another time, including into another holiday year.
The Working Time (Coronavirus) (Amendment) Regulations 2020 SI 2020/365 have been made and brought into force with immediate effect. They amend the Working Time Regulations 1998 SI 1998/1833 to relax the restriction on carrying over untaken annual leave into the next leave year where leave has not been taken because of the COVID-19 pandemic. The untaken leave can be carried over into the next two leave years. The new rule applies to the four weeks of annual leave provided for by Reg 13 WTR but not the additional 1.6 weeks of annual leave provided for by Reg 13A, which is already subject to different rules on carry-over.
What about people working other jobs during shutdown for example?
The position for zero hours workers would be different as they can no longer be bound by exclusivity clauses so would be free to work for others. However, whether employees can work for others during this time to supplement lost income, we need to consider the health and safety obligations and also working time. Also, if there is work to be done for you, is this going to be completed or impacted if they work for others? What about any sensitive information or business risk? This is an area to be flexible on and discuss with your staff.
What about workers?
Workers – be they casual staff, zero hours - are entitled to basic statutory protection e.g. holiday and holiday pay, working time, the NM/NLW, discrimination/harassment protection as well as health and safety protection. Some may qualify for SSP. They do not qualify for strictly “employee-related rights” so things like unfair dismissal protection, statutory redundancy pay or “LOST” or it seems the new government backed retention scheme. However, often it can be a grey area as to whether a worker is truly a “worker” and not an employee so every case has to be looked on its facts. Generally speaking, workers can be terminated or contracts changed in accordance with their terms. Workers would not, unless the contract states otherwise, be entitled to any notice pay.
If workers are “working” then they should be paid. If workers are off sick or self-isolating, then they would not be entitled to be paid by the Company. If they are working from home, they should be paid. If hours are to be changed, then they need to be informed, ensured they are being paid the NL/MW and be given proper notice of the changes.
However, workers are a valuable resource to your business which may be needed as and when things pick up so it is worth keeping in touch with them.
What if people are not following processes or not “working”?
Where people are out of the workplace environment, we need to have checks in place to ensure they are productive – or as productive as they can be. Some may be looking after children so again we need to be more flexible as we might otherwise be. This could be allowing early morning/late at night work or agreeing core contact times throughout the day.
But if you do have staff refusing to comply with reasonable working requests, refusing to work from home or if you believe they are abusing your sickness rules or simply not working, then your ultimate sanction is to discipline.
The introduction of the Coronavirus Job Retention Scheme is “unprecedented” and we await the detail. The other measures we discussed are not without risks – especially, when we think about redundancies. Yes, employees could resign and claim constructive unfair dismissal or unlawful deductions from wages if pay is cut or they are forced on to unpaid leave. However, if we communicate, ask for suggestions and think outside the box then businesses and their workforces can manage the situation. From our experience, employees have great ideas and it is always better to work with your people that try and impose changes.
Remember too that your people, clients, customers and guests will look at how the business has handled this situation; this is a time to think long term about your brand and loyalty to it.
Additional information can be found:
Consistent with our policy when giving comment and advice on a non-specific basis, we cannot assume legal responsibility for the accuracy of any particular statement. In the case of specific problems we recommend that professional advice be sought.