Employment Law: Furlough, Redundancy and Statutory Sick | August 2020
During these challenging and difficult economic times for many businesses, it is not surprising that this month’s employment law update remains focused on the ongoing changes to regulation surrounding the furlough scheme.
1. Redundancy Pay
The Government introduced new regulations on 31st July 2020, which provides employees with more than two years’ service (who are made redundant during a period of furlough leave) the reassurance that they will receive their statutory redundancy pay based on their usual rate of pay, rather than their reduced furlough pay (subject to the statutory cap of £538 per week).
Prior to these new regulations, employees whose hours and/or rates of pay varied were entitled to statutory redundancy pay calculated on a 12 week average, meaning that their redundancy pay would have likely been reduced to reflect their rate of furlough pay.
From the above date any entitlement to redundancy pay will be calculated using their full rate of pay. The new regulations also provide that payment for a statutory notice period must also be based on the employee’s usual rate of pay, rather than their reduced furlough pay.
2. Statutory sick pay – Self Isolating and/or Shielding
A further set of amendment regulations were introduced from 6th July 2020, which provides statutory sick pay (SSP) entitlement for those who are self-isolating and/or shielding.
SSP payable is now payable to anyone who is self-isolating because they are in a ‘linked’ or ‘extended’ household (a ‘bubble’) with someone who has COVID-19 symptoms. Previously this only applied to those living in the same household. SSP will cease to be payable if the symptomatic person tests negative for COVID-19. This is covered by the Statutory Sick Pay (Coronavirus) (Suspension of Waiting Days and General Amendment (No.2) Regulations 2020.
These amendment regulations also provide some clarity on the SSP entitlement of those ‘extremely vulnerable’ people who are shielding. The individual’s original shielding notification, specifying an end date at which entitlement to SSP would cease, can now by overridden by a further notification, which means that an individual can commence shielding again (where necessary) and be entitled to receive SSP.
It is important to keep abreast of the continuing developments in legislation relating to this area by visiting the government website.
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