VocabuLaw

Furlough

What is it and what does it mean?

Description of the legal term Furlough:

Furlough is a term traditionally used in labor law to describe a temporary leave of absence from work, which may be voluntary or involuntary and is often for a specified period due to the needs of the employer. In the United Kingdom, furlough has a particular significance following its widespread use during the COVID-19 pandemic when the government introduced the Coronavirus Job Retention Scheme (CJRS).

Under the CJRS, the UK government allowed employers to place their staff on furlough as an alternative to making redundancies during the crisis. While on furlough, employees were kept on the payroll but were required not to work. The government provided financial support to employers to cover a significant portion of the wages of furloughed workers, up to a certain cap, to prevent job losses and ensure that businesses could survive during the periods of lockdown and reduced economic activity.

The furlough scheme was a temporary legal measure introduced by the government and underwent several modifications throughout its operation. It included full-time furlough, where employees did not work at all, and flexible furlough, where employees could work part-time and remain on furlough for the remaining hours. Employers were given the flexibility to decide the extent and nature of the furlough, subject to the rules of the scheme and agreement with the employees.

Legally, the furlough arrangement required the consent of both the employer and the employee, as it generally meant a variation of the employment contract. For most employees, being on furlough meant receiving 80% of their regular wages up to a monthly limit. The specific details of each furlough agreement had to comply with employment law, requiring employers to treat their employees fairly and without discrimination.

Furlough measures introduced in response to the pandemic were not typical of the standard use of the term in British labor law, where traditionally it might have been used to discuss layoffs in relation to military personnel or in specific industries. However, the exceptional circumstances of the pandemic led to the term becoming mainstream and a critical part of employment vocabulary in the UK.

Legal context in which the term Furlough may be used:

An example of furlough occurred in April 2020 when a UK-based airline, facing a severe decrease in flights due to travel restrictions, decided to furlough 80% of its workforce. The government’s CJRS allowed the airline to receive grants covering most of the employees’ salaries, providing the company with the breathing space necessary to navigate through the unprecedented downturn in the aviation industry without resorting to mass redundancies.

The employees on furlough had varying experiences; some appreciated the time away from work as a needed break, while others struggled with the decrease in income. The airline’s management had to navigate complex employment laws and maintain clear communication with their staff to ensure that the furlough process was implemented smoothly and in compliance with the legal requirements of the CJRS.

Another instance involved a small independent restaurant in Manchester that had to close during the lockdowns. The owners placed their chefs and waiting staff on furlough. This government support allowed the restaurant to retain its talented team, which was crucial for reopening successfully once restrictions were lifted. The furlough scheme provided a lifeline for this small business and many others like it across the UK, enabling them to survive the economic pressures of the pandemic.

The prominence of furlough within the British legal and economic landscape during the coronavirus pandemic has highlighted the importance of flexible government responses in times of crisis. The adaptation and utilization of employment laws to provide support to both businesses and workers during exceptional circumstances underscore the potential for responsive legal frameworks to mitigate the impact of unforeseen events. The idea of furlough, now firmly embedded in the public lexicon, serves as a reminder of this critical period and reflects the adaptability of employment practices in the face of significant challenges.

This website is for informational purposes only and may contain inaccuracies. It should not be used as a substitute for professional legal advice.