13/09/2020 - Bad bosses take advantage of Furlough rules

450px-ArcadiaGroup.svgSolidarity has sadly been fighting many cases relating to redundancy in recent months.

We've now had several employers who have given notice to employees during the furlough period - a ruse to get out of paying full notice pay at the end of the contract. We've even had bad bosses seeking to force workers to take their holiday entitlement whilst on furlough knowing that they will be making them redundant.

Again, the motive is to cut costs for the employer and push them on to the taxpayer.

That too means that workers will receive less at the end of their contract. We've fought this in several ways - telling the bad bosses that we will name and shame them and querying the notice given requiring the use of holidays (amongst others).

We've achieved some success with our members getting more than other employees in the same firms.

We weren't surprised to read about the Arcadia Group (which is the parent company of Topshop, Burton, Dorothy Perkins, and other fashion retailers) seeking to use Taxpayer funds to the disadvantage of their workers. In a leading article the Times said:

"We report today that the enterprises of Sir Philip Green are using a loophole in the furlough scheme to reduce the costs of making staff redundant while still accepting government subsidy. The practice is not illegal but it is self-serving. The job retention scheme was designed to hold society together in a historic crisis. For businesses to use the scheme in this way is contrary to the civic spirit that has been on display in other walks of life."

The Times goes on to explain the ruse:

"Under the job retention scheme, Arcadia has claimed millions of pounds to meet its wage bill. It intends to claim millions more, including the retention bonus of £1,000 that will be payable for each furloughed employee who remains continuously on the company’s books up to January 31. At the same time, it has made 300 staff at head office redundant but paid them reduced rates during their notice period. The rationalisation is that the staff agreed to a change in their contractual status when they accepted being put on furlough in April.

The sums are large. Some staff have been receiving only half the pay they would have got if the group had not taken advantage of the furlough scheme. Yesterday, Arcadia partly reversed course, telling staff they would be paid at the full rate of pay once the furlough scheme ends next month. Until then, however, employees who have been made redundant will get reduced pay." (1)

Solidarity doesn't entirely blame the bad bosses.

The UK government could have drafted rules preventing all these abuses.

They should have assumed that bad bosses would seek to put costs onto the taxpayer and made rules that anticipated and prevented this.

When you consider the resources available to the government in terms of legal advice it is shocking that they did not do so.

(1)The Times view on Sir Philip Green, coronavirus and furlough: Commercial Cupidity, Saturday, September 12, 2020, The Times.