Employers abuse of loopholes in Furlough support

Karen773

During Collective consultation for redundancy, my research on the Government Furlough support indicates there are loopholes which allow employers to claim Furlough money to cover notice period payments. We have also seen articles relating to employers using an employees acceptance of salary reduction to 80% during furlough, to then only pay those employees who are made redundant 80% salary of notice payment, not their full contractual salary. Does anyone know if this is legal under current Furlough Support conditions? If so, are there plans for Government to update the scheme and prevent this from happening? Companies abusing financial support to pay off redundant roles is not what a job retention scheme was set up for! Any help much appreciated for ongoing consultation talks. 

Jeremy535897

You might be interested in this, if you have not come across it already in your research:
https://www.employmentcasesupdate.co.uk/site.aspx?i=ed40723

Thrugelmir

Legislation is on it's way. This will provide employers with 30 days to correct any "errors".  Likewise will provide the HMRC with the tools to take action against Company Directors personally i.e. recovery of funds. There'll be no protection from having a limited status. 

Jeremy535897

Thrugelmir said:

Legislation is on it's way. This will provide employers with 30 days to correct any "errors".  Likewise will provide the HMRC with the tools to take action against Company Directors personally i.e. recovery of funds. There'll be no protection from having a limited status. 

The draft legislation appears to confine action against company directors to cases where the company is insolvent or at risk of becoming insolvent.

Thrugelmir

Jeremy535897 said:

Thrugelmir said:

Legislation is on it's way. This will provide employers with 30 days to correct any "errors".  Likewise will provide the HMRC with the tools to take action against Company Directors personally i.e. recovery of funds. There'll be no protection from having a limited status. 

The draft legislation appears to confine action against company directors to cases where the company is insolvent or at risk of becoming insolvent.

Situations can be engineered. Always been a few that try to circumnavigate whatever rules are in place.