Weighing up the options when furlough ends
Changing terms and conditions, short-time working, layoffs, restructures and redundancy
If you are expecting a reduction in trade and business when the furlough support ends, then it is going to be necessary to make some plans about what kind of business and what roles you will need.
There are a few options worth considering:
Changing terms and conditions of employment
may be a way of avoiding making redundancies. This could include changing what employees are required to do in their roles, changes to their contracts, pay or benefits. In short, everything is up for review. Any changes however need to be done with an employee's agreement which would involve consulting with affected employees, and in some circumstances employee representatives.
Short-time working
is when the hours worked are reduced for a period of time (in agreement with the employee) but the employment contract hasn't changed. This arrangement is helpful if it is expected that business will pick up. Some contracts will have short-time working explicitly stated in the employment contract. If not, then the employee would have to agree to this arrangement in writing. This is usually agreed for a temporary period of time.
Layoff
is a term that often gets misunderstood, with many people think this means redundancy, however it does not mean an end to the employment, it is a period of time (a minimum of 1 day) where no work is available. There is no limit to the length of time an employee can be paid off, however after 4 weeks of layoff an employee can request to be made redundant. Employees laid off are entitled to a payment of £29 for each day laid off, to a maximum of 5 days in a 3 month period. The furlough scheme is a form of layoff whereby there is no work, but the individual remains an employee.
Restructures
can help to review the structure of the business and make sure that it is set up in a way that meets current and future challenges. This may lead to reductions in headcount, new reporting lines and changes to roles and responsibilities, including multi-skilling and outsourcing some activities. It's best to think about the roles that you need rather than think about the people who are currently in the organisation when creating a new structure. Considering the individual's skills, knowledge and suitability for the roles would be a next step. Such changes may lead to changes in terms and conditions as set out above.
Redundancy
will take place when a role is no longer required. This can be individual roles or multiple roles. There are formal procedures that must be followed to ensure that the selection process is fair. Remember that a redundancy is a dismissal and employees can bring about claims for unfair dismissal if they feel they were unfairly selected for redundancy. If you have had some employees furloughed and others working, you must have a separate redundancy procedure, as you cannot rely on the decisions that were made to furlough selected individuals.
If you would like to discuss any of these options in more detail, please get in touch.





