With the government’s recommendations on social distancing regarding Coronavirus and yesterday’s announcements that schools are to close after Friday, Wake Smith’s employment team looks at how employers can deal with the current situation.
Employment solicitor Briony McDermott answers the most frequently asked questions.
What is the current government guidance?
The current position is that staff should work from home where possible, however where this is not an option and there is a downturn in work this can cause employers a headache.
So what are the options?
There are a number of options available from flexible working to short-time working and lay-offs (provided you have the contractual right to do so). The worst case scenario would be that a redundancy situation arises.
What does flexible working mean?
Flexible working could be a reduction in hours or a change in the way employees work, for example a change in shift patterns. It could also include short periods of voluntary paid or unpaid leave.
As this would strictly speaking be a variation of contract (albeit hopefully a temporary one), you would need to consult with and seek the agreement of employees to implement this, however it is likely given the current climate that they will be agreeable to changes if the alternative would be to consider permanent redundancies.
Be wary of solely relying on any variation clauses in your contracts of employment as these will be subject your duty to maintain employees’ trust and confidence and to rely on them could leave you open to claims of constructive dismissal. It will, therefore, be very difficult to rely on any such clauses to impose a contractual change. However, in certain circumstances, it may be possible to use a ‘dismissal and re-engagement’ process in order to force through the variation.
What is the difference between short-time working and lay-off?
Short time working is where an employee’s weekly pay is reduced to less than half as a result of a reduction in hours worked.
Lay off is where an employee is not given any work at all for a minimum of a full week. This is a temporary measure and an employer would update an employee regularly.
When can short-time working and lay-off be implemented?
In order to lay employees off or put them on short time working, an employer must have the express contractual right to do so. This means that the contract of employment must contain a clause stating that employees can be required to stay away from work, or accept a reduction in hours on a temporary basis. The clause should also reserve the right to reduce pay according to the reduction of work.
If there is no contractual right to lay staff off or put them on short time working, it may be possible to agree this with them as a short-term measure and an alternative to redundancies.
What do I have to pay employees who are on short-time working or lay-off?
Employees on whole days of lay off are entitled to receive statutory guarantee pay for a maximum of 5 days in a 3 months. Statutory guarantee pay is a nominal amount and is currently set at £29 per day.
Can I force employees to take annual leave?
Under the Working Time Regulations, it is possible to require workers to take annual leave at a time specified by the employer. Employers must give at least twice as much notice as the period of leave they are requiring employees to take.
It may therefore be possible to ask employees to use annual leave until the situation returns to normal, however this could cause unrest amongst employees and you will of course need to be mindful of pre-booked leave.
What help is available to me?
The government has published guidance on the help available for businesses at this difficult time. This guidance can be found here. The current message is to review the guidance and speak with the Business Support Helpline on 0300 456 3565 before making any decisions.
Please note, this advice is correct at the time of writing, however the position is constantly evolving so please do check before making and decisions which could affect your employees.
For the latest up to date advice contact Briony at [email protected]
