Gross pay of employees furloughed mid month

Are employees furloughed part way through a month entitled to full pay up to date of furlough

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Having worked normal hours for 1st to 22nd of March an employee is furloughed on 23rd March. Are they entitled to full pay for that period plus 80% pro rata for the period 23rd to 31st March? Or does the fact that they have agreed to be furloughed mean they only get 80% of their usual monthly salary for March. 

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By mikeyban
01st Apr 2020 20:40

Hi...

My client’s are doing what you stated... full pay then 80% for the final week.. marking the payslip with two notations...normal pay and 80% furlough.. I hope that helps

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By mikeyban
01st Apr 2020 20:42

duplicated

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JCACE
By jcace
01st Apr 2020 22:06

My understanding is that strictly, they are entitled to full pay, in line with their contract of employment, until such time as they agree to have those terms varied, most obviously under the terms of the furlough on which they are placed. The guidance reminds employers that any changes to status will remain subject to employment law, and you should therefore notify staff of their furloughing and, where possible, seek their agreement.

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Replying to jcace:
Caroline
By accountantccole
02nd Apr 2020 06:50

There are going to be some interesting legal cases in the future. A lot of short cutting and changing of contracts going on.
I’m caveating all my emails with “take legal advice...”

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By paul.benny
02nd Apr 2020 07:40

Really? You seriously think that those who have worked normally for 3/4 of the month can/should have their pay cut for that period?

And the 80% is a subsidy to the employer. Some employers are choosing to pay 100% of salary.

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By neiltonks
02nd Apr 2020 08:00

Of course they're entitled to be paid for the time they worked. The furlough payment is for the time when they're actually furloughed and therefore they're not working.

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By Duggimon
02nd Apr 2020 08:29

In the absence of an agreement by both parties, they are entitled to their full pay up to and after the date of furlough, and for the forseeable future.

The government grant to businesses does not automatically cut people's wages, nor are employers entitled to cut wages of employees unilaterally.

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By MJShone
02nd Apr 2020 08:30

You need to separate out the payroll from the furlough grant. The furlough grant doesn't determine what you pay employees who are on furlough. It's the opposite way around - what you pay your employees while they're on furlough determines what furlough grant you get. So pay your employees whatever you're going to pay them for the furlough period - 75%, 80%, 100% - whatever. (Bearing in mind employment law.) Then work out what grant you can claim (when we know the rules).

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Replying to MJShone:
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By rockallj
02nd Apr 2020 11:39

MJShone wrote:

You need to separate out the payroll from the furlough grant. The furlough grant doesn't determine what you pay employees who are on furlough. It's the opposite way around - what you pay your employees while they're on furlough determines what furlough grant you get. So pay your employees whatever you're going to pay them for the furlough period - 75%, 80%, 100% - whatever. (Bearing in mind employment law.) Then work out what grant you can claim (when we know the rules).

@MJShone. Absolutely right. Guys/gals you’re conflating two things. EMPLOYMENT LAW/CONTRACT FIRST, everything else second. And ensure it’s a written agreement between the parties. There will potentially be litigation all over the place when the crisis is over.

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Replying to MJShone:
By Duggimon
02nd Apr 2020 12:31

The furlough grant is in no way determined by what you pay your employees now, it is, per the government guidance, either their regular salary as at Feb 28, or an average over the 12 months to Feb 28, or their monthly wage from the same month in the previous year.

The employer will be reimbursed 80% of this amount. They must therefore pay at least 80% of this amount to their employee. If 80% of this amount is less than the employee is contractually entitled to then they will have to agree the reduction in wages with the employee.

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By SteveHa
02nd Apr 2020 08:53

So potentially asking if it's OK to pay employees below NMW for work done?

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By tom123
02nd Apr 2020 12:08

NMW doesn't apply during furlough period, as there are no actual 'hours' over which to divide the pay.

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By Duggimon
02nd Apr 2020 12:29

You've missed their point, the original question was about reducing wages for the part of March in which the employee has worked.

If the question wasn't already ridiculous, SteLacca is pointing out one more reason why it's a crazy idea.

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Replying to Duggimon:
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By tom123
02nd Apr 2020 12:36

Yes, I agree - the idea that you could reduce pay after the hours are worked is fanciful.

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