Coronavirus furlough update – do you need written agreement?

Source: Pannone Corporate 

At the end of last week the publication of a Direction from the Treasury to HMRC setting out the legislative framework for the operation of the Coronavirus Job Retention Scheme caused concern for many employers who had furloughed employees without obtaining their express written agreement.

The Direction specifies that in order for an employee to be properly furloughed, they must have “agreed in writing(which may be in an electronic form such as an email) that the employee will cease all work in relation to their employment.”  This is inconsistent with the official guidance published by the Government which has always stated that in order to be eligible for the grant employers must simply “confirm in writing to their employee that they have been furloughed.”

The Government has now added a note of clarification to its guidance, presumably in response to the concerns raised by this inconsistency.  The guidance now states:

“To be eligible for the grant employers must confirm in writing to their employee confirming that they have been furloughed. If this is done in a way that is consistent with employment law, that consent is valid for the purposes of claiming the CJRS. There needs to be a written record, but the employee does not have to provide a written response.”

This makes it clear that employers do not need to produce express written agreement from employees – written notification and implied agreement, or agreement via collective bargaining should suffice.

If you would like advice on any of the issues raised above or assistance with drafting a furlough agreement, please do not hesitate to get in touch with us.