Employers can only implement short-time working or lay-offs if they expressly have these terms correctly drafted in their contracts of employment. However, employers can also implement lay-offs or short-time working if they get consent and employees agree to this which, in the current climate, employees are open to as they feel that their only alternative may be redundancy.  

In the current climate we are encouraging all of our clients to think creatively about how they can retain their workforce by working collaboratively with their employee base. Don’t make assumptions about what individuals will or will not be willing to do to retain their job and help the business succeed. Taking an open and honest approach with your employees will mean that they feel consulted with and, if the worst does happen, they will feel that they have had every opportunity to help mitigate the situation.

Lay-offs are where an employer asks employees to stay at home and not attend work and be paid for a temporary period whereas short-time working is when an employer requires their employee to work less than their regular contractual hours, for example reducing to a 2-day week.

During these periods, employees who meet the following criteria will be eligible for Guarantee Pay:

These payments are to partially compensate employees for the temporary reduction in salary. These payments are minimal and are a maximum of £29 per day for 5 days in any 3 month period (a maximum of £145) We did warn you that it wasn’t a lot! Not paying guarantee pay counts as an unlawful deduction from wages which could result in an employee raising an employment claim so it is important that you pay this to eligible employees.

As we know this situation is not short term and we won’t return to ‘normal’ for a significant period. This can mean that where employees are affected for longer periods, they may then become entitled for redundancy pay. Employees must resign and provide written notice of their intention to claim this. If this does occur, then employers can avoid redundancies if they guarantee employees 13 weeks consecutive work within 4 weeks of receiving the employees notice.

So in summary, in the current climate if employers are forced to close then they will be expected to pay employees in most cases. Layoffs and short-time working may provide employers with some savings and mitigate the need for any redundancies however, this can only be implemented if the required clauses are in your employees’ contracts of employment or, if they subsequently consent to the changes.  

 

The situation can be confusing so, if in doubt, please contact us at Clear Bridge HR for more specific advice and support.