Job retention scheme – treatment of redundancy for furloughed employees

Aug 17, 2020

The UK Government has recently introduced legislation setting out how a ‘week’s pay’ should be calculated for employees who were furloughed under the Job Retention Scheme (JRS) and who are then made redundant. This legislation is in force in England, Scotland and Wales from 31 July 2020 and does not have retrospective effect. It therefore only applies to payments and awards made on or after this date. Northern Ireland is expected to introduce equivalent legislation at some point this month.

The legislation aims to ensure that furloughed employees entitled to certain statutory payments (including statutory redundancy and notice pay) receive payments based on their ‘normal’ wages rather than on their reduced furlough rate of pay.