Covid-19: Employment update

Clients will be keen to know precisely where they stand in order to determine whether to move ahead with plans to reopen offices, or to shelve them indefinitely.

Working from home vs returning to the office

The message has reverted to a plea for office workers to work from home "if you can". The Government’s formal guidance online (which can be found here, in respect of office-based employers) has not yet been updated but presumably this will be done in the coming days, consistent with the Government’s summary of what has changed, and with the PM’s own thoughts. The question is a familiar one and continues to be what does "if you can" really mean? 

The Prime Minister gave an example of how this question might be thought through, saying in Prime Minister’s Questions:

Where people must go into work for their job, their mental health, their wellbeing or whatever it happens to be, then of course they should do so. What we are saying is that they should work from home if they can.

The Government’s online summary document (which is available here) puts the question slightly differently, saying "office workers who can work effectively from home should do so over the winter".

The announcements clearly mark a fundamental change in emphasis, with the default position being that employees able to work from home should do so. Only where there is a clear case for returning to the office should this be permitted, either full- or part-time. As the Prime Minister’s example demonstrates, and as we have noted in previous bulletins, each individual’s personal circumstances, health, caring responsibilities and fears will need to be taken into account, alongside business efficiency and productivity metrics, in assessing each employee’s position.

Although the Prime Minister signalled that sanctions would be imposed on "businesses breaking Covid rules", it seems extremely unlikely that any business that goes through a proper risk assessment in consultation with its workforce, and arrives at a reasoned conclusion on working from home and/or office working will face any form of sanction whatever decision it ultimately reaches. 

Furlough

Clients will know that the Coronavirus Job Retention Scheme ends in its current form on 31 October. Details of how the scheme works can be found in our separate article.

Given the further restrictions announced yesterday, the Chancellor has reportedly been modelling a number of different options to try to support employment levels over the winter months. According to the Financial Times, Mr Sunak has in mind a scheme proposed by the CBI, under which employers able to offer workers at least 50% of their normal hours would receive a state subsidy for one-third of the hours not worked. The employee would receive full pay for hours worked, plus one-third of unworked hours from their employer, plus one-third of unworked hours from the public purse.

As an example, if Mary’s employment contract with BigBank plc requires her to work for 42 hours per week at £15 per hour, but there is only demand to support 21 hours of work.

• BigBank plc pays full pay for the 21 hours Mary actually works, plus seven of the 21 hours she does not work. Total bill £420 instead of £630.
• HM Treasury pays seven of the 21 unworked hours. Total bill £105
• Mary receives both the above. Total wage £525 instead of £630

This would, in all probability, be an alternative to the Kickstart and Job Retention Bonus schemes already announced. More generous schemes have been proposed by the TUC, and apparently remain under consideration.

We shall keep clients updated as guidance changes. If you would like to discuss your firm’s position, please speak to your usual Macfarlanes contact.