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Can you furlough staff who will be made redundant?

Cafe has to close because of Covid but now given notice by owners

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I have a client who has had to close her cafe business (the premises are rented) due to Covid. The cafe owners are now saying they are going to run it themselves, so has asked my client to leave, but haven't given her a date yet.

Normally this time of year she would be open, the staff worked through November and so they would of been furloughed for December & probably a few months following. If she is given notice to move out of the cafe by say January, can she still pay them under furlough for December. I have read the guidance under HMRC and see you can still pay furlough even though staff are to be made redundant. However, it would be good to have somer further guidance if anyone can help.

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By bernard michael
14th Dec 2020 09:19

Will the staff be covered by TUPE ??

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By the_drookit_dug
14th Dec 2020 09:23

The furlough grant can't be claimed for any employees serving a period of notice of redundancy.

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By psimonparsons
14th Dec 2020 10:52

No. The employer would not qualify for grant from 1st December. They would need to pay the notice pay and fund from the business.

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Replying to psimonparsons:
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By Geoff56
14th Dec 2020 11:10

Agreed. You could claim for notice periods only up to 30th November.

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Replying to Geoff56:
ALISK
By atleastisoundknowledgable...
14th Dec 2020 11:38

I’m not disagreeing, but seems harsh, double (triple?) whammy on the business owner.

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Replying to atleastisoundknowledgable...:
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By Geoff56
14th Dec 2020 12:03

Yes, quite. Upon re-reading the question, it is not clear that the staff have actually been given notice yet. If the cafe owner is keeping them on, in the hope that things may change, then she could claim. However, as soon as notice of redundancy is given, then under the new rules from 1st December, one cannot claim for a notice period.

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Replying to atleastisoundknowledgable...:
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By gillybean04
14th Dec 2020 14:19

Harsh in what way?

It doesn't sound like the business has failed due to covid. Their lease is expiring and they have decided to close rather than relocate to different premises.

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By Mabel
14th Dec 2020 12:20

Thank you all for the responses, it has been really helpful. No she hasn't given the staff notice yet & I have advised her to go to ACAS Scotland for TUPE advice.

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Replying to Mabel:
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By Missing in action
14th Dec 2020 13:34

Is relocation an option, or is it situated in a spot where it catches a lot of passing trade? (e.g. garden centre, next to a bus station etc).

Loyal customers would probably follow...

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By Mabel
14th Dec 2020 14:32

The business has failed due to Covid. They closed because there is no trade as hardly anyone is going out locally or further afield. The decision had to be made as the rent & staff wages would outweigh any sales. The owner of the property has a shop alongside and decided as the cafe was closing due to Covid, they would utilise the cafe for Coffee & cakes, which can be managed by shop staff. For other reasons, the owners decided that as my client couldn't afford the rent, they would continue in this manner and not rent out the cafe anymore.

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