What will be the added cost to business of furloughing staff from 1 July 2021?

Potentially. The first question is why the person is not able to return, as their individual circumstances will be very relevant in terms of whether they can be safely dismissed.

Employers should ask themselves 2 questions in this situation:

1. Have I done everything I am required to do in order to make the workplace safe for the individual to return; and
2. Is what the employee saying reasonable?

If the answer to question 1. is no then a dismissal is unlikely to be fair. However, even if the answer to question 1. is yes, then there is still question 2. to address. If the employee has reasonable grounds as to why they are unable to return to work, e.g. due to health issues, childcare responsibilities etc then the dismissal is unlikely to be fair. It is only if you can answer yes to question 1. and no to question 2. that you can have some confidence in the potential safety of the dismissal.

Dismissals based on objections to returning to work on health and safety grounds will very often be risky and are highly fact specific, therefore please contact one of the employment team for further advice prior to dismissal.

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On 4 May 2020, the Government launched the Bounce Back Loan Scheme (BBLS), which is intended to cut red tape to enable smaller businesses to access finance quickly during the coronavirus outbreak.

The scheme helps small and medium-sized businesses to borrow between £2,000 and up to 25% of their turnover. The maximum loan available is £50,000.

The government guarantees 100% of the loan and there are no any fees or interest to pay for the first 12 months. After 12 months the interest rate will be 2.5% a year.

The length of the loan is 6 years, but it can be repaid early without penalty. No repayments will be due during the first 12 months.

Under the scheme, lenders are not permitted to take any form of personal guarantee or take recovery action over a borrower’s personal assets (such as their main home or personal vehicle).

Businesses can apply for a BBLS loan if it:

• is based in the UK
• was established before 1 March 2020, and
• has been adversely impacted by the coronavirus.

Any business regarded as being a business in difficulty on 31 December 2019 will need to confirm that it is complying with additional state aid restrictions.

Businesses from any sector can apply, except the following:

• banks, insurers and reinsurers (but not insurance brokers)
• public-sector bodies, and
• state-funded primary and secondary schools.

Businesses already claiming under the following schemes cannot apply although it is possible to convert an existing loan under such schemes into BBLS:

• Coronavirus Business Interruption Loan Scheme (CBILS)
• Coronavirus Large Business Interruption Loan Scheme (CLBILS)
• COVID-19 Corporate Financing Facility.

There are 11 lenders participating in the scheme including many of the main retail banks, which are listed on the British Business Bank’s website (www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/for-businesses-and-advisors/). Applicants are directed to approach a suitable lender via the lender’s website. If an applicant is declined by a lender, they can apply to other lenders in the scheme.

The lender will ask applicants to fill in a short online application form and self-declare that they are eligible. All lending decisions remain fully delegated to the accredited lenders.

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The courts are seeking to adapt to our new circumstances and have urgently been looking to introduce new ways of working. The courts have been testing out different ways of holding court hearings. The advice is changing almost daily and some courts have been developing local practices. Going forward the court, the parties and their representatives will need to be more proactive about all forthcoming hearings.

Everyone involved in the case is to consider as far ahead as possible how future hearings should best be undertaken and work collaboratively. It will normally be possible for all short, interlocutory, or non-witness, applications to be heard remotely. Some witness cases will also be suitable for remote hearings. The parties just need to ensure that everyone involved can use the technology suggested.

The courts have been looking at and held remote hearings using, non-exhaustively, BT conference call, Skype for Business, court video link, BT MeetMe, Zoom and ordinary telephone call. Bundles for the hearing will be prepared and circulated electronically.

If the hearing cannot be held remotely because the parties do not have the requisite technology or the length of the hearing combined with the number of parties or overseas parties, representatives and/or witnesses make it undesirable to go ahead with a hearing in court at the current time, then it may be that the case will need to be adjourned. We are hearing of trials being adjourned and that they will not be re-listed before at least September.

HMCTS has advised that several priority courts will remain open during the coronavirus pandemic to make sure the justice system continues to operate effectively. It publishes a daily operational update from the courts and they aim to update it by 9am. The link is https://www.gov.uk/guidance/hmcts-daily-operational-summary-on-courts-and-tribunals-during-coronavirus-covid-19-outbreak.

Also, the courts have circulated a civil listing priority list with Priority 1 listing work which must be done and which includes injunctions, any applications in cases listed for trial in the next three months, any applications where there is a substantial hearing listed in the next month and all Multi Track hearings where parties agree that it is urgent.

In the Priority 2 list, which consists of hearings which could be done, are enforcement of trading contracts, trial involving the survival of a business or the insolvency of an individual, small and fast track trials where the parties say they are urgent, and appeal in these kinds of cases.

Similarly, in arbitration proceedings, the parties and arbitrators are being encouraged to utilise technology to make sure that hearings take place. We have heard of Zoom being used very successfully for multi-party proceedings.

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The MHFA training makes this clear, it should be made clear in the MHFA role specification and procedures and discussed during regular MHFA peer support and MHFA surgery sessions. It is important to ensure that where an Employee Assistance Programme is in place, all MHFAs have details of that scheme available so they are able to instantly share details of the scheme with those who require support. If in doubt due to serious concerns then using 999 or Samaritans is an option.

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Following our webinars on all aspects of furlough and alternatives to redundancy, it is an unfortunate fact that a number of organisations are likely, sooner or later, to be forced to make some employees redundant.

Our employment experts Jamie Gamble and Roisin Patton take you through the key aspects of conducting cost reduction redundancies, but with a focus on aspects that make this exercise different this time. For instance:

• How are you going to conduct sensitive meetings remotely?
• How are you going to ensure that dismissing any furloughed staff will be fair? You may have furloughed at speed, but redundancy selection criteria cannot be defined by such factors.
• Will you use this time to review your selection criteria if you already have some in place?
• How will you deal with individuals who are shielding, have child care issues or are pregnant?
• How do you ensure this is all done sensitively and fairly for those roles that are being made redundant, but also for those who continue to work for you but are still isolated on furlough or working from home?
• And what are the risks for making redundancies in this “new normal”?

Although you may be perfectly familiar with redundancy exercises these are far from normal times and it is therefore worth pausing to think about the impact that Covid-19 might have and what else you need to think about or plan for.

The webinar was recorded on Thursday 2nd July.

 

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