Can you be made redundant while on furlough? Redundancy rights explained and how scheme will change up to October

Thousands of workers across the UK were put on furlough as a result of the coronavirus outbreak

The UK government introduced the emergency Coronavirus Job Retention Scheme in March as part of efforts to help businesses pay the wages of their staff, up to the value of £2,500 per month.

But what are your redundancy rights if you’ve been put on furlough - and can you be made redundant?

Can I be made redundant?

Employers should use a fair and objective way of selecting staff for redundancyEmployers should use a fair and objective way of selecting staff for redundancy
Employers should use a fair and objective way of selecting staff for redundancy
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Furloughed workers are those whose employers cannot cover staff costs due to coronavirus. As such they have been asked to stop working, but have not been made redundant.

However, your employer can still make you redundant while you are on furlough, or afterwards, but your employee rights are not affected if you have been furloughed.

This includes your redundancy rights.

What are my redundancy rights?

Employers should use a fair and objective way of selecting staff for redundancy, with common methods including:

- selecting employees with the shortest length of service first

- asking for volunteers (self-selection)

- disciplinary records

- staff appraisal markings, skills, qualifications and experience

Your employer has the right to make you redundant without having to follow a selection process if your job no longer exists.

This could involve your employer closing down a whole operation in a company and making all staff working in this area redundant, or if you are the only employee in your part of the organisation.

You cannot be made redundant for reasons relating to sex, gender, race, religion, disability, or age, among others, which would be classed as an unfair dismissal.

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If you are made redundant by your employer, you must be given a notice period before your employment ends.

The statutory redundancy notice periods are:

- at least one week’s notice if employed between one month and 2 years

- one week’s notice for each year if employed between 2 and 12 years

- 12 weeks’ notice if employed for 12 years or more

As well as statutory redundancy pay, your employer should either pay you through your notice period, or pay you in lieu of notice, depending on your circumstances.

How long will I be kept on furlough?

If you were placed on furlough by your employer, you initially needed to remain on furlough for a minimum of three consecutive weeks. However, this three week rotation rule is being scrapped in July and the scheme closed to new applicants on 30 June.

The scheme was originally meant to end in June but the Chancellor has now extended it until the end of October.

As of 1 July, UK employers can bring back furloughed staff to work for any number of hours or shift pattern, while still being able to claim the grant for any hours not worked.

When staff are working as normal, their employer will be responsible for paying their wages. However, if you are still placed on furlough for part of the week, the government will pay for your wages for the hours you have worked.

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It means that employers who cannot afford to pay their staff a full wage will be able to welcome them back to work, without leaving them out of pocket.

July will also mark the final month that the government will cover other employer contributions, including National Insurance and pension contributions.

From August, workers will continue to receive 80 per cent of their wages, up to a cap of £2,500 per month, for the hours an employee is on furlough, but their employer will have to pay the additional contributions. This includes National Insurance and pensions.

From September, government contributions will drop to 70 per cent of staff wages, up to a cap of £2,187.50 per month, for the hours an employee is on furlough. Employers will pay the difference to bring the payment up to 80 per cent.

From October, government contribution will drop further to 60 per cent, up to a cap of £1,875 per month, for the hours an employee is on furlough. Employers will then pay the difference so that workers still receive the full 80 per cent of their wage. On 31 October, the furlough scheme will come to an end.

What if I don’t want to go on furlough?

If your employer asks you to go on furlough and you choose not to, you could be at risk of redundancy or termination of your employment, depending on the circumstances of your employer.

However, this must be in line with normal redundancy rules and protections.