Furloughed employees gaining time off in lieu for bank holidays?

[IllegalFred]

My husband's company has just announced it it intending to furlough some of their workforce and will top up their pay to 95%. They've also stated that those workers who are furloughed over the bank holidays will gain those days as additional annual leave.

Can anyone advise why this would be the case? It seems a bit bizarre. Although some staff work bank holidays currently, it's not a normal working day, i.e. you volunteer to work it and get additional time off in lieu at a later date.

I don't know the answer to this but I'd be interested to find out!

I would assume it's because they aren't able to 'take' their bank holidays as they are furloughed.

There is very little guidance available for employers on this and a reasonable assumption would be to approach it the way you would if someone was on maternity leave for example (when they would accrue holiday and bank holidays too).

Employers are worried that if they stop and start furlough leave to allow people to 'take' bank holidays then they may do something 'wrong' and not be able to claim their money back when the portal is launched.

Everyone is trying to work things out as they go along, they are brand new rules and there is no case law to look back on. I'd be interested to hear what other companies are doing about this. There are quite a few bank holidays coming up soon!

It's not sitting very well with the employees who are still having to work, who've been told they'll be picking up the furloughed employees work and been restricted from booking any annual leave. To find that the furloughed employees are gaining a minimum of 2 days additional leave is the icing on the cake!

I get that completely l.

At the moment there is an equal split between those being furloughed and scared for their job security ('why me, will I be the 1st to lose my job when this is over?') and those stuck at work when they want to be safe at home.

I'm not sure if the link below works but it shows that employers are currently waiting for government guidance on this.

Probably because during their time on furlough they will not be accruing any annual leave so will actually end up with less over the year

It's a weird thing to do, holidays are cancelled during furlough and you're able to take them over the next holiday year, but bank holidays, nope, maybe the company thinks they can claim the cost back through furlough from the government.

They will accrue holiday whilst on furlough leave as they still have an employment contract in place.

Probably because during their time on furlough they will not be accruing any annual leave so will actually end up with less over the year

Where did you get this from?

Massively unfair to people still working. What do furloughed employees need extra holidays for?
Im furloughed and would much rather be working. I probably won’t get time to take my holidays when we get back never mind extra ones.

There's no suggestion that furloughed workers will lose any of their holiday allowance.

They've been told that if you have 10 days annual leave left and are furloughed and return at the beginning of June you will return with 14 days annual leave (2 Easter bank holidays and early and late May bank holiday).

Meanwhile, if you carry on working at the beginning of June you just have your 10 days left.

"There's no suggestion that furloughed workers will lose any of their holiday allowance."

If they are not allowed to carry over those bank holidays they will lose part of their holiday allowance. They're on furlough, not on holiday.

"They've been told that if you have 10 days annual leave left and are furloughed and return at the beginning of June you will return with 14 days annual leave (2 Easter bank holidays and early and late May bank holiday).

Meanwhile, if you carry on working at the beginning of June you just have your 10 days left."

Are the staff who are carrying on working having the bank holiday taken away from them then? Are they not allowed to take it off/have it in lieu later? If not, they are the ones losing their holiday allowance.

By far the safest option at the moment is to assume employees cannot be on furlough and holiday at the same time - this would be consistent with maternity leave and other similar leaves. Therefore if an employer had someone on annual leave (including bank holiday) whilst on furlough, there is a risk HMRC could refuse the claim based on the 3 week minimum being broken.

Therefore, safest thing to do is to allow those staff on furlough to take their bank holiday once they come back. Staff who are still working should be able to take it as normal now.

Haven't read the full thread but furloughed employees retain all the statutory rights & any terms in their contract over & above that which means they'll continue to accrue holiday entitlement during the furlough period.

Everyone normally gets bank holidays in addition to their holiday allowance, they are not required to use annual leave to take the bank holiday off.

So people who are still working, will not be at work on the bank holiday. People who are furloughed will also not be at work on the bank holiday (or before or after) but will gain the days back in annual leave.

I've read this www.streetsweb.co.uk/about/news/2020/apr/3/easter-bank-holiday-coming-do-furloughed-staff-sti/?utm_campaign=Coronavirus enewsletter 13&utmmedium=email&utmsource=CMASTREETS CHARTERED ACCOUNTANTS&utmcontent= today

Everyone normally gets bank holidays in addition to their holiday allowance, they are not required to use annual leave to take the bank holiday off.

But technically speaking, they all get an extra 8 days' leave and then use those 8 days against the bank hols. The only reason no-one ever bothers actually adding the 8 days and then deducting off the bank hols is because it's a waste of time, it always balances to zero every year for full timers who get bank hols off.

Think of it that way and it makes more sense. Both the furloughed and non furloughed workers are given 4 days' leave to use for the bank holidays between now and June. The ones at work will take their bank hols off as normal so it come off their 4 day allowance. The furloughed workers don't get to take their bank hols as they're on furlough, so they still have their 4 days left.

The fact that none of them are at work on those specific dates is irrelevant, some of them will be on bank holiday leave on full pay and some of them will be on furlough on 95% pay. The ones on furlough get to use their bank holidays later in the year. What's important is that by the end of the year, all of them will have had the same total number of fully paid days' leave throughout the year.

Based on a tweet from HMRC customer support today (this is the kind of thing we’re having to rely on at the moment), it’s looking like it will be possible for staff on furlough to take holiday (including bank holidays) while on furlough without breaking the 3 weeks, as long as employer tops up pay to 100%

Thanks flowery that's a good news update. I wish they'd update the guidance with some more specific information on certain things so we can all actually be clear. I've started half my sentences this week with the caveat 'it's my interpretation...'

At least it's Friday

Yes, the top up would make more sense. The furloughed workers are already being paid 95% for their bank holidays is how i see it.

There's already going to be issues about people being able to use their annual leave going forward and giving furloughed workers a lot extra to take is only going to increase the pressure.

It makes no sense to give furloughed workers the bank holidays in addition to normal holiday when they return.

If they wouldn't normally work a bank holiday then they can't be paid furlough pay for it. So the employers needs to pay them their normal b/h pay.

If your employees are hourly paid, you wouldn't add 8 hours furlough for a bank holiday because they wouldn't have worked it.

If your employees are hourly paid, you wouldn't add 8 hours furlough for a bank holiday because they wouldn't have worked it.

The 80% furlough isn't calculated based on an hourly rate it's based on the salary of the employee, or either what the employee earned for the same period the previous year (2019) or an average of their earnings for the 19/20 tax year of their earnings are variable.

They aren't physically working any hours so it's pointless to calculate it based on the hourly rate.

The thing with holidays (bank or otherwise) is that a furloughed employee cannot take holidays from being furloughed because then you're not really on furlough that day (you're on AL) which is why they are being carried over - furloughed employees will be permitted to carry over holidays into the new holiday year (where this runs Apr-Mar) in the same way those on SMP & SSP are.

I agree with PP though the guidelines are very open to interpretation & without clear guidance on how the payroll should be processed to clearly identify furlough employees/amounts when it comes to claiming the funds back it's going to be a minefield trying to work out what/who you can actually claim for.

I don't think it's going to be as easy as everyone thinks it is.

Plenty of people receive their pay as hours worked x hourly rate, we have weekly and four weekly payrolls which are based on hours worked. Their furlough pay will be worked out as contract hours x hourly rate, of which we will claim 80%

It will be interesting to see if the government does reimburse 80% furlough for the bank holiday pay. We're working on the basis that they won't.

Yes but you're not going to work it out as:

80% of 40 contracted hours & process for 32 hours - the answer will be the same but the working isn't correct.

I've had colleagues try to process this by inputting regular hours/salary then adding a deduction of 20% as opposed to processing at zero for regular pay then calculating the 80% & processing this as an addition specifically named Furlough which will cause no end of issues when we try to pull reports to make claims for the correct amounts.

If this isn't processed & reported in a clear way (for which there are no definitive guidelines) then it's likely to be used as a reason excuse not to pay out.

But it should NOT be contacted hours x pay x 80%.
It should be based on the higher of their same pay period LAST year or the 19/20 average (with rules covering employees who weren't employed at that point last year).

Furloughing is akin to gardening leave and you continue to accrue leave during this period, in the same way you do if on sick leave, despite being absent and any booked leave reclaimable.

It's not odd. But yes a kick in the teeth for those not furloughed.

However, the furloughed staff must be furloughed as there's no work for them. So as a consequence noone else should be picking up their slack. That would be the issue I'd be challenging.