Can you make employees on Furlough redundant first?
Employees on furlough can be made redundant, however, employers should keep in mind the purpose of the Furlough scheme is to retain employees in the workforce. Therefore, if an employer puts employees on Furlough and then immediately makes them redundant, the use of the Furlough scheme may be more subject to scrutiny by HMRC. The fact that an employee has been on Furlough would not mean that they would necessarily be considered for redundancy. The usual rules when considering who is to be made redundant would apply. A genuine redundancy situation must exist, there will need to be a fair selection pool and a fair process would need to be followed.
It has been clarified that for furlough claim periods which start on or after 1 December 2020,as an employer, you cannot claim for any days on or after 1 December 2020 on which an employee is serving their contractual or statutory notice period. Further guidance may be published at the end of November 2020.
Is there a separate process for making Furloughed employees redundant?
The procedure for making an employee redundant whilst on Furlough will not essentially differ from the normal process. A genuine redundancy situation should exist, a selection pool will need to be identified, selection criteria applied as necessary and individual consultation will need to take place. This may prove more difficult as face-to-face consultation may not be appropriate in most circumstances. Video or telephone conferencing, with the employee still given the right to representation of a work colleague or trade union representative, may be the best alternative.
Will it be an unfair dismissal if an employer makes someone redundant rather than placing them on Furlough?
This is still quite a difficult question to answer. As ever, it will depend on the individual circumstances of the case. The usual requirements of fairness and reasonableness will apply. The financial position of the employer would be relevant. If a genuine redundancy situation exists, the fact the option to place an employee on Furlough exists but is not used would not mean that the dismissal would necessarily be unfair. An employer would however need to show that they have considered using the Furlough scheme, the reasons why it may not be appropriate in that particular case and have followed a fair process.
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