Employees Returning from Spain - An Employer and Employee’s Options in this SituationPosted in : 'Any Questions' Webinar Recordings on 7 August 2020
The Government has announced that anyone returning from a holiday to Spain will now have to self-isolate for 14 days upon their return to the UK. What impact this will have on employees and their ability to work?
In this webinar we address your questions on an employer and employee’s options in this situation. For example:
Q. Should employees be discouraged from going on holiday to Spain? May employers even go so far as to warn employees that their jobs are at risk if they go to Spain or another ‘unsafe’ destination for holidays?
Q. Can they be put back onto furlough for the duration of the self-isolation period?
Q. Can they lawfully be dismissed if the cannot return to work after their holiday due to enforced isolation?
Q. What payments are appropriate for isolating employees?
Q. What happens if other employees refuse to work with a returning employee?
Scott: Good morning, everybody. This is Scott Alexander. I'm from Legal Island. Welcome to the latest webinar that we do every month on the first Friday of the month with Seamus McGranaghan from O'Reilly Stewart. In the background is Rolanda Markey from the L&D team at Legal Island. And we're going to be dealing with your questions today all about holidays, furlough, redundancy, all those kinds of juicy things have been going on, a little bit about the difference between Northern Ireland and GB because the legislation has changed in relation to some payments there. Obviously, Monday facemasks come in. It's a very changeable situation that we've got there when it comes to employment law.
Seamus McGranaghan from O'Reilly Stewart, the director there specialising in employment law, he's going to be speaking at this year's Annual Review of Employment Law today, or this year in November. So we've got right about, I think, 17 or 18 speakers involved at the moment and confirmed. We've got all the various sessions. It's going to be a two-day online thing. Now you can see there it's currently on the 11th and 12th of November, and the lovely people, the CIPD have decided to put their national conference on the same date.
We might be interested in hearing whether you want us to change those dates. I think we might our dates just so that everybody could maybe go to both, if you're interested in going to CIPD National Conference and the Legal Island Annual Review of Employment Law. I don't think CIPD is going to move, so I think it's in the interest of our customers who are nearly all CIPD members. But we'll see what people want to do next week or the next week or so.
So you can see if you're looking on the right-hand side and if it's the very first time that you've been here, there's a little question box. You can ask questions throughout. We've received a number in advance and that's what we're going to do. We're going to work our way through a number of questions that have come in in advance. We're going to be looking at those questions.
And then we'll go to your questions if we have time at the end. If not, we can carry them forward to our next webinar which will be on the 4th of September, with Seamus, obviously. You can get in touch with Seamus or myself during the time. I think, are we ready to go to the polls Rolanda?
Self-Isolation on Return from Holidaying Abroad
So we're going to look at two key areas here, most of it is about returning from abroad and holidays and options for employers. And we're also going to be looking at redundancy issues as well. So if we start, Seamus, with the first question that came in:
Should employees be discouraged from going on holiday to Spain? And while we say Spain, it could be any country that isn't on the safe list. Okay.
Scott: The employers even go so far as to warn employees that their jobs are at risk if they go to one of those countries or another unsafe destination for holidays. So what's your opinion there, Seamus?
Seamus: Just a bit about the background, we'll all be aware but essentially, 26th of July, when all travellers arriving from Spain and that includes the Balearics and the Canaries. They have to self-isolate for whenever they return back to North Ireland for a period of 14 days. And the reason for that has been due to a number of flare-ups and increased numbers on the virus and across Europe, but Spain has been really the hotspot. But we've heard that there are further flare-ups happening in the likes of Spain and the likes of France and things like that as well.
So really my sort of first observation was on the swiftness that the government used to empty impose those quarantine periods for Spain. There was very little notice. It caught a lot of people off guard. And I did see in the news, the business owners that were coming back to say, having a business but I'm not going to be able to go into work for 14 days, it leaves a real problem here. So I think that we do need to keep a careful eye on developments. It was only just last night that also added to that unsafe list, if we put it that way, are Belgium, the Bahamas, Andorra, and that that's going to take effect from Saturday. And obviously Spain would be a big one because a lot of people in Northern Ireland travel to Spain for their holidays every year. And, you know, but it is worth keeping an eye on the list to see what . . . France would obviously be another one that have an impact here.
But it's important and I just want to highlight as well, the implications of quarantine. It's important to note that anyone who's asked to quarantine, they must comply unless they're exempt by the rules, so there are some medical issues in and around the exemptions. But it does mean that whenever you can get back into Northern Ireland, you have to immediately return to your home and you can't stop at the shops on the way home. You can't do anything. You have to return immediately. You have to provide your details on arrival at the airport or if it's the boat, or what the situation, but you have to provide your details. And if you fail to do that, there are other obligations, there's fines. And whilst during this quarantine period, you can't attend work, and you can't go shopping for food. You can't go outside for exercise. So it's a more serious situation than just a lockdown that we dealt with quarantine, and I wanted to make that distinction that it's not lockdown circumstances. It's quarantine. You go into your house and you don't leave for 14 days.
And the failure to self-isolate is a criminal offence, and currently in Northern Ireland, it's the same as the UK. The fine can be up to £1000, and we are aware that there could be these inspections where you provide your details on arrival back into Northern Ireland and someone may call at your home to ensure that you and your family are in quarantine and that you haven't left out for half an hour to go to the shops to get food.
There are some exceptions as I said. There is the ability I think in relation to attend for medications and things like that or for doctor or hospital appointments, but in essence, you're back home, 14 days at home and you can't go anywhere. And so there are discussions in work of an employer or employers travelling to Spain, they should be made aware of the fact, they should be clearly aware of the fact that they won't be able to attend work for 14 days whenever they return home.
And I'm really getting to the point in the question there. It's not normal, it's not usual for an employer to dictate to an employee what they do in their private time and that would include us telling them where they can and can't go holiday. And so you're talking about your civil liberties and your freedoms and things like that. But I think the employer has to be very clear on what the circumstances are and I do think that an employer can discourage an employee from going on holiday abroad, whether that's to Spain or to somewhere else where there may be a sudden quarantine period imposed. And I think you have to make it clear to the employees that if they go abroad, and it is to an unsafe country, that there will be this period of quarantine that will have implications on their ability to return to work. And that there is a very real position just looking back at the poll there as well, but they may not be paid for the period of quarantine where they're not able to attend work.
Look, I think we need to be careful that some people have booked their holiday pre-lockdown. and they may decide to go if they can even if after quarantine afterwards. That may leave a bad taste in the mouths of the employer. The employer might be very frustrated or annoyed at an employee who decides to go ahead and proceed with their holiday. But on the flip side of that, Scott, we were just having a brief chat there about, probably this has been one of the wettest and coldest Julys that we can think of. We had great weather during the during the lockdown, which was which was brilliant and, you know, thank God for it but really you're hitting the holiday period now. And there is that expectation for people that they need a break. And, you know, circumstances, you know, we don't know what's going on in people's lives during this lockdown and maybe the need for a break and some sunshine and all the rest. So I think we do need to do some thought around that.
Scott: You said, Seamus, you know, you could certainly discourage people from going. But it's up to them if they want to go. That's not going so far as to say you are not allowed to go… That's going a bit far. Is it?
Seamus: Yeah, because the second part of the question is asking, you know, can you tell employees that their jobs are at risk. And I think caution needs to be exercised there in relation to that. So it is a balance that you have to get. I think, for me, it's the important aspect is that is to have that reasonable and sensible conversation with your employees about their travel. Some of them may have booked holidays and have not disclosed that they're intending to go away. You may hear rumblings of it from other employees, and where that is I think it is perfectly fine to approach the employee and have a discussion about what is happening. It's important that you set out your expectations. And you can do that in the policy or even in an employee update if you don't have the time or you're pushing this through. You don't want to put a formal policy, even an employee update to the staff to say to them, and if you're going abroad, this is what's going to happen and you're going to have to be . . . there's a requirement for you to self-isolate.
And so types of things I think that you should be looking at is, you know, you should be asking employees to notify you as an employer if they are intending to travel abroad. And that should be open, and that should be an open conversation. And I think that it's important that you tell them that they're going to be in this period of quarantine whenever they return. It depends on whether the employee is going to be able to work from home. If the employee is already working from home, it might not have that big of an implication. But the employer still does needs to be aware because for instance if something urgent happens where you would normally ask the person to deal with a disciplinary or grievance aspect, and they're not going to be able to come into the office to deal with that, they're going to have to maybe look at alternative arrangements, whether it's doing it digitally or whatever it is.
Or if there's some sort of crisis at work. I was talking to a client during the week that had said that there was a serious health and safety issue that arose and they required their employee to travel from Northern Ireland to England and there's no difficulties in doing that as regards the current quarantine them and all that kind of stuff, but it does have implications and wider implications as there was a sudden and quick implementation of quarantine. I think you have to look at whether or not going to be paid during quarantine, if they can take any outstanding holidays. And, you know, all those sort of things I think should be discussed in advance, and I think both parties need to be clear before the period of holidays, what exactly the situation is.
I would caution against threatening an employee that their job is going to be at risk. And, you know, potentially, if there are 52 week service and their employment rights in place, they could consider that that's a fundamental breach of employment contract, and maybe look to bring a claim for unfair constructive dismissal. I think you need to be cautious about that and, you know, I don't think and employer wants to appear in any way retaliate on the basis that someone is not taking the encouragement, the advice that they've been given, and go off on holiday then, you know.
Scott: Seamus, I think the more likely scenario is the employee goes and then the employer sacks them without going through the 123 procedure. And have already indicated even if they do have a process that they're going to sack the person, a bigger danger here that is automatically unfair in most circumstances, not to go through a 123 process of dismissal, statutory dismissal procedures.
Can we move on to a slightly different one which is:
When they come back, you've looked at a couple of the options. Is furlough an option and is it really only an option where they've already been on furlough?
So a furloughed employee goes on holiday, and they come back, presumably, there's nothing wrong with being on holiday while you're on furlough, but is there a difference between an employee who is currently employed? I'm working from home, it's Scott Alexander. I do you have a holiday booked in the Canary Islands. I decided to go. When I come back, they want me in work. They can't get me in work. So they try and put me on furlough. That may be difficult. Wouldn't it?
Seamus: Yeah, I mean, the furlough scheme is there. I mean, ultimately, I think that there's a potential argument that employers could place the employee on furlough to cover a period of quarantine. And whether if they return from a period of overseas travel or something along those lines. And there are conditions there. Obviously, the employee has had been furloughed previously for at least a three week period prior to the 10th of June, and also the issues of in and around and you know that you're limited there in terms of the maximum number of employees that you contain for a claim period. And, you know, there's no clear guidance really around whether, you know, whether it is suitable or unsuitable. I think the ability is there to do it, but I did look back at looked at some of the government guidance in relation to it.
The government are discouraging people from employers placing employees back on furlough, just because it's their holiday period, or they worked holidays in order to obtain the benefit of the furlough scheme and saying that the treasury direction and we talked about the treasury direction and the guidance from the government and the two sometimes conflicting aspects of both of them. But it does say that the purpose of the scheme is to continue the employment of employees whose employment activities have been adversely affected by COVID-19 or the measures taken to prevent or limit its transmission, which for me does include quarantine, and potentially then you could use that furlough scheme. I mean, ultimately, I think that depends a lot on the mindset of the employer. If you have an employee who has gone ahead and taken this holiday even though you've tried to discourage them there could be a bit of a sour taste as to whether or not you could place them back on furlough or not. I think that for me is the bigger issue.
The other thing I just wanted to flag up about the furlough scheme is that you just need to be careful how you're treating one employee to another. If you have an employee that hasn't been on the furlough scheme and has worked through the process, and you don't have the ability to put them on furlough, are they going to claim that they're being disadvantaged, because another employee is able to be placed on furlough where they maybe had to use the remainder of their holidays, or they had to take a period of unpaid leave. So you could see that the argument arising between two employees. And again, always try to encourage consistency whenever you're looking at these matters, so that there can't be any claims of somebody's being treated less favourably than somebody else.
Payment during Self-Isolation
Scott: Okay. So is there anything else on payments that you want to discuss before we move on to the question that we got in about casual and bank staff.
Seamus: Yeah, I mean, look, you know, I just wanted to be sort of clear as well. There's been a lot of talk in and around, you know, what's appropriate and what should we be paying for employees that have to self-quarantine and did see the quote. I'm sure a lot of people did see the quote that Secretary of State for Foreign Affairs Dominic Raab said that if somebody is following the law in relation to quarantine and self-isolating the way they should, they can't have penalties taken against them. And I've seen that rubbish time and time again and anything that I've come across.
And ultimately, just to be clear about it, employers don't have to pay employees if they're not able to work because quarantine. If you can't attend your place of work, and you're only able to work from home as the alternative, there's no obligation for the employer to pay the employees. We're also clear that SSP is not . . . employees are not eligible for SSP during a period of quarantine. The official guidance from the government is that employees are not entitled to SSP if they've been self-isolating whenever they return to Northern Ireland, and that would be reflected, Scott, just of whenever we look at the poll there, the very last option was SSP and I think that was around something like 19%.
And then, and then the third one is that, you know, potentially employees, and I'm saying potentially employees could be dismissed if they don't go to their work whenever they return from holiday. You know, in the broad scheme of things, the failure to attend work is a potential disciplinary action, and general in most cases if somebody can't return to work, and they can't work from home, they're not entitled to be paid. That leads to the question, what would be the appropriate payment? And anyone who self-quarantines that doesn't have coronavirus symptoms is not entitled SSP. Your SSP entitlement arises whenever you become sick.
And careful as well for employees if you've sent anybody abroad for business purposes, and whenever they come back, you say, "Well, you have to quarantine. I'm not going to pay anything." I could imagine that raising a difficulty, and certainly in and around the constructive one for dismissal aspect if somebody has had to travel on work purposes. But there are other options and just to run through those quickly, you know, there is the option of working from home and receiving their normal salary. For me, that will very much depend upon whether the employee can work from home and whether the employer is happy for them to work from home during that period.
Glad to see during the poll that a lot of the employers are saying, "Well, if they were already working, there's no reason why they couldn't work from home whenever they get back from a holiday." And I've also seen references to employers finding other work for employers to do so that they can work from home so working can even be facilitated. I can imagine that that might have some issues or some problems. You know, the sort of idea of temporary reassignment of duties in order to facilitate the work from home.
But need to be clear, and look, I think we all need to be clear and we probably are all very clear, that if somebody has been away, let’s take Spain for instance, and they arrive at the door of work on the Monday morning, and you're obliged to tell them that they cannot return to their workplace. You can't have them coming into the workplace and you must immediately send them home if they arrive for work. So there could even be, I could imagine, given where we're at, I could imagine employers taking a step and saying, "You know what, I really need the work done. I'm going to have to have this person in and back," and there's not going to be a clear problem. You're going to end up probably with at worst, health and safety executives for Northern Ireland coming in and raising issues. Certainly, the other staff are not going to be comfortable with that, so important to say that for me is not an option.
And other things you can look at is relaxing holiday policy, allowing employers, or employees to use their excess holidays that they might have built up during that period of 14 days or offer alternative unpaid leave as a as an option. One other one that I did see was that there was a suggestion around somebody making up some or all of the 14 day leave period by working through additional hours whenever they get back or working over their contractual hours for a period of time whenever they get back and are using toil and things and things like that as well. So there are options out there, and I think it just depends on, you know, what the employer is willing to do, but certainly the government advice seems to be about you should and try to facilitate as much as possible.
Casual Staff and the Furlough Scheme
Scott: Okay, let's move on to another area there, Seamus. If you've just joined us folks, you're listening to Seamus McGranaghan from O'Reilly Stewart, talking about all things to do with the furlough scheme, COVID, holidays and the impact of that has on the employment. We got a slightly different one earlier and I know there are dozens of questions coming in. Folks, we'll get to those. Normally these webinars last around 45 minutes but we extend it where necessary to deal with the additional questions and we've loads and loads coming in.
We've made the decision to furlough casual/bank staff at the start of the job retention scheme, but on reviewing our business need, we are highly unlikely to need the casual bank staff moving forward. In effect, there will be redundancies. With employer costs starting to increase with regarding the furlough scheme, can we remove them from the furlough scheme and if so, do we need to give them notice and/or some kind of rationale regarding our decision?
Seamus: Well, this is interesting. It was always one that that that did give me some concern whenever I did see through the coronavirus job retention scheme that you could include and casual and bank staff. Obviously, these are these are staff that wouldn't have any guaranteed hours of employment so very much you're working on the basis of offering the employee hours when they're available and there wouldn't be any obligation on the employer to offer those hours and certainly there's no obligation on the employee to accept those hours of work either. So, and you're usually talking this sort of casual working relationship.
I know a number of employers that did take steps particularly in sort of hospitality, where they say okay we're going to work on an average of the hours that you've worked and pay you and, you know, under the furlough scheme for it. And for me, in my mind certainly, it sort of created a bit of a dangerous precedent there where the employee could potentially then say or the worker should say, and could potentially say well, you know, if that's the process that you're taking now, well then, you know, I, I would say that that that those are my sort of guaranteed contractual hours going forward.
So I think it's important that you refer back to the correspondence that you would have issued at the time of notifying the employee that they were being moved to furlough and the time whenever the consent was obtained in relation to that, it was an interim measure. And I think that a third decision is now being made whereby the organisation can't afford to continue with furlough scheme, I think notice does need to be provided to the worker in relation. I think you have to be fair to them and it could be maybe given a running period to say that on a certain date they will be removed from furlough, and they will be reverting back to what the contractual relationship was in advance of the furlough scheme, which would be back to this aspect of casual working where work is available, you may be offered but there is no obligation to accept.
And so I think to be fair to the worker, notice, some sort of notice should be given, and you know, they'll maybe have had a reliance upon, and that their money is under the furlough scheme. So I think it's fair to give notice but you need to be clear. And I would issue this in writing to each of those workers as well, that you're moving back to the pre-furlough position.
Scott: Just in case though, Seamus, cut across you there, the person that wrote in is saying we don't have any work for these guys. It's not a question of moving them off the furlough and putting them back on. It's we don't have any work. We're making them redundant. We don't need casual staff. We don't have enough work for our own staff. They're already on furlough. It's costing us money to keep people on that we don't need, and they're not even actual employees. They're just people that we're bringing once in a while so we don't really need to bank list anymore.
Seamus: Yeah, look, in that sense certainly, look, the contractual basis of the relationship is that there isn't any obligation to provide work, and it depends on how the employer wants to deal with that going forward, whether they want to take the step of notifying the employee that they are relinquishing or that they're removing their bank list, or whether it will just be, we're going to continue on, you know, with the list but maybe that we'll not have work for you for a period of time. And, you know, again, probably about communication there. For me, you know, formal notification at the bank list is being removed, is it gives clarity around the issue. It potentially raises issues for those bank staff to say, "Well, I'm entitled to a redundancy payment if you're dismissing me," and you have to be very clear that it's not a dismissal. And because of the fact that there's no contract of employment in place where there was guaranteed hours, that it was, you know, work on a casual basis, and there's a decision simply now that work isn't available any longer.
Scott: Yeah, I suppose given that they're not employees, is the argument, unless they can establish they are, they wouldn't be entitled to redundancy payments either because they're not employees. So yeah, I suppose what you're saying is like you're on the bank list but we don't need anybody at the moment. Obvious, the need to actually do any kind of termination, regardless of whether it's a worker or self-employee contract or employee, so that might be the best option to that person that wrote in.
Calculating Redundancy Pay for Employees on Furlough
We have another question here, Seamus, and it's about redundancy pay and it goes back to the fact that in England, they change the law about redundancy pay and how it should be calculated. Or they tried to clarify it and it's caused some problems. The question is:
I've paid my employees their statutory redundancy pay based on their furlough pay. I heard that something came in last week to say that it should be based on pre-furlough pay either average earnings before the lockdown. Does this apply in Northern Ireland and will I have to make up the difference?
So just before you answer just to clarify that, I've been in touch with the department for economy who told me that the Northern Ireland equivalent of the GB legislation and, Seamus, you will explain that in a minute, is was at an advanced stage. And I think that was, when I was chatting to them, it was last Friday or Monday or something. There are issues with it. It seems to have impacted on notice pay inadvertently. I asked the department to have a look at that, and reconsider what they're doing, because it you could deny people their rights inadvertently by changing the law.
So could you maybe explain what you think the law should be, the GB situation, and what may happen if that's brought in in Northern Ireland? And the indication was it was going to be brought in in early August so we would have expected it next week, round about now.
Seamus: Yeah, that's right. Maybe you have thrown bit of a spanner in the works for the NI government there, Scott, with your notification to them, but I think that's helpful and the right thing to do. And, but yeah, essentially, the basic position that I have always taken when it comes to the calculation of statutory redundancy pay is that it should be calculated on the pre-furlough rates. I think the situation was arising that a number of employees, as part of this question, then decided to calculate the statutory redundancy pay on the furlough rate at the 80%.
And so I was sort of pretty clear in my mind anyway if have a look back on government guidance from the 3rd of June, on furlough and redundancy, and it's clear and it's set out that the redundancy calculation should have been based on the contractual pay that is contained within the contract of employment and those original pre-furlough rates. Well, in England what they did and across in the UK they have brought in the Employment Rights Act 1996, and then in brackets, the coronavirus calculation of a week's pay regulations 2020. Again, talking about the speed and the quickness with the government moved on. This was legislation that was originally flowed, I think, on the 29th of July, and it came into effect and forced on the 4th which was last Friday, and it gave clarification in and around the calculation of a week's pay for the purposes of statutory calculations.
And I think what's clear is it doesn't apply yet in Northern Ireland, but we were told and the expectation is that it would come into effect in Northern Ireland in August. And essentially, the regulations send a clear message that employers should not take advantage of reduced pay rates to dismiss employees cheaply. And that's it in a nutshell, essentially. And under the regulations clarification is provided that redundancy and notice pay should be paid at the pre-furlough rates, and if you paid redundancy under notice pay based on the furlough rate, or an increased rate but lower than the contractual pre-furlough rate so you may think we're topping up to 90% and calculated on that basis, you should go back and backdate those payments and so that the appropriate and the proper payments are made to the employee which is the pre-furlough salary, and that's what we should calculate on.
Scott: Could I just come in there, Seamus? Because that's what I would've expected would have applied anyway. And if you have a temporary layoff and somebody's on furlough, which we have at the moment, it's not that different to the layoff situation that you may have had before and you have to make somebody redundant. The law states in the 1996 order, employment rights order in Northern Ireland same as the act over in GB that you go back to the original pay. It's the same if they're sick and so on. There are elements when it comes to know this, but you give them the proper wage. That's how statutory redundancy pay, which is used in the weeks' pay calculation was calculated.
I'm not entirely sure they have to clarify it, but it has been clarified that it should be the pre-furlough stuff so that's fine in GB. Your opinion is that it should be the pre-furlough stuff anyway in Northern Ireland. This legislation is coming into Northern Ireland, but can you maybe explain the problem when it comes to notice pay because notice pay didn't have a cap. And then, in statute when it comes to a week's pay when you're trying to figure out, you know, if you pay somebody redundancy pay, you know, 10 weeks redundancy, 12 weeks redundancy, whatever it happens to be that there's a cap on that. But there isn't on notice pay. You get your actual pay. For a lot of people it doesn't really matter because they earn less than, you know, £500, £600 a week, but for those that are more than that, there was never a cap on notice pay. And this changed. The legislation seems to have caused a bit of a problem, so maybe you can explain why I went on to the department about that particular situation.
Seamus: Yeah, so the issue is then, with the change in the legislation, that there's the potential that the legislation imposes a statutory cap on the notice pay. So, you know, if you are dismissing, there's obviously your statutory noticed period under that it could potentially be a larger contractual period after that as well. So if I only been there for four weeks but my contract says that I have to give, or I have to get three months' notice, then, you know, it extends it out. Our position, really has been that, you know, we would we would look at that on the basis of what the normal rate of pay would be, and we work it out on a weekly basis but there is the statutory cap that applies. And I think it's 538 it's in the UK but in Northern Ireland, £560 a week, and under the legislation imposes a statutory cap on the notice pay of the £560 per week, which will have a serious detrimental impact upon any employee that is facing dismissal.
And that's the point, Scott, because I believe that you've raised with the department in order to flag that up to them because they understand the needs that the government are not trying to chip away in any respect the employment rights of employees and that is an error that's been created by the legislation in England and we would hope would be rectified for any introduction in Northern Ireland.
Commission and Furlough
Scott: Okay, and can we move on to another area? This is a lengthy question, then we'll get to the customer questions if you don't mind, Seamus. We'll move away from the ones that have come in pre. We'll go to the live ones after this. This quite a complex one so listen up, folks.
We have been paying our employees furlough payments. It ties in with what we've been doing here. Furlough payments at basic rates of pay, most if not all were also paid commission on sales prior to lockdown but obviously none have earned any commission during the day. We have received no income from sales.
One of our employees has argued that she should have been receiving and should now receive furlough payments at 80% of her total average earnings, and that we have been unlawfully deducting their pay since March, April, and the introduction of the furlough scheme. This particular employee has always earned commission when working over the last three years, but her salary increase last year when she was promoted in October. So, if she is right, should she receive an average wage? Do we include the old salary in the calculation over the last 12 months -- I think there's a 12-month calculation period in England -- or just over the last three to four months at the higher rate?
By the way, this employee is based in London, and what would you advise? So slightly different rules when it comes to calculating average pay, I think, in GB compared to Northern Ireland, but even leaving that if you've got somebody, they're normally on commission or other payments, should they have been included in furlough payments and the calculation of 80% pay?
Seamus: Yeah, well, the current government . . . I mean, there was a bit of an ambiguity in and around the start of the introduction of the scheme but you know as we were getting these updates on the scheme from Revenue & Customs and every few weeks, there was clarity that was given and essentially the current government guidance confirms that payments at the discretion of employers such as discretionary bonuses and commission payments are excluded. And if you're talking to the tech [strong shares 00:40:33] and non-cash payments and things like health insurance or use of a company vehicle should be excluded. But what was included within that was that when calculating the 80% share that you would include sort of things like regular wages and variable [PAYU 00:40:50] wages, fees, compulsory bonuses, and compulsory commissions.
So for me, it comes down to what the situation is as regards with the contract of employment says, but I would imagine that if the commissions are performed and seen as a part of their regular salary and they're regular wage, there should have been a calculation to include that as a compulsory commission, and included that within the within the salary itself as regards the calculation of the furlough pay of 80%.
Now, where I think that that's very clear is that when I look at the flip side of it and I look about to see what payments should be excluded. And it's the things like discretionary bonuses and discretionary commissions and, you know, tips, those things that I talked about previously there. But for me, I feel that it's very clear cut there, that if those commissions form part of their regular wages, and even if they haven't been able to earn those commissions because they have been unable to work and obtain those, but if they form part of the regular wage, then those will be compulsory commissions that should be paid and should have been paid through the period of furlough.
Scott: Yeah, I suppose the problem for the employer is that they haven't paid at the right level. They could've paid it all back. You know, had they paid 80% of average earnings, they would've claimed it all back. But now there's a situation where the employee and presumably other employees that are in this situation where they have been underpaid as per a government scheme, and I presume the employer won't be able to claim back the difference now, because they haven't claimed it in the first place.
Seamus: Yeah, it would certainly maybe raise a few eyebrows. But obviously, look, you know when I'm talking about the 80%, there's obviously the £2500 cap as well in relation to that. So it depends on the commission rate so if there was a shortfall arising above and beyond the two and a half, that wouldn't be recoverable in any event. And the other point is just that in this query, there is an issue in just reading here that there was a pay increase in October. So look for regular salaried employees, and you know, the employer should look at the base calculations on actual salary before tax as of the 19th of March. But where there's variable pay and it could well be variable pay if it's based on commission and the employer could have claimed the higher of either the same months earning before from 2019 of the average monthly earnings for the 2019-2020 tax year.
So that would be the steps that you would take in order to, you know, complete the calculations. But for me, if it forms part of the regular wage, and then you could almost see a situation for someone who's earning, you know, basic minimum, and you know that the national minimum wage or the living allowance, and they're completely dependent upon their commission payments for the remainder of their pay, you know that that would be very detrimental to them, and, you know, for me there to be a clear case there of sort of unlawful deduction of wages potentially under this furlough scheme.
Scott: Okay, thank you very much, Seamus, for that one. Now, folks, you're listening to Seamus McGranaghan from O'Reilly Stewart. I'm Scott Alexander from Legal Island, and we've got Rolanda, who's been sending out your questions here before. Now, we'd normally stop here. We're recording the whole webinar. If you can't stay one, you will be getting a recording or a link to a recording afterwards and it should be up on the website hopefully this afternoon, certainly by Monday we'll be getting it transcribed as well.
However, we have loads of questions and, Seamus, so what I'm going to do now is keep it open for a few minutes longer. If you can stay with us, great. If not, you'll get the recording, you can listen to the last 10 or 15 minutes or whatever. So I'm going to take you through the questions you can see in front of you, we've got a couple of webinars coming up there on the 4th, and we also got data protection one with Anna Flanagan, so it's updates on the 10th of September.
Self-Isolation – Issues Arising
But before we finish, let's deal with some of these questions that came in from the audience. Seamus, you haven't seen these.
If someone has to go for a medical appointment and has to have a COVID-19 test to be done prior to that appointment, and has to self-isolate until the appointment, so this isn't somebody on holiday, would this be class from sick leave, or work from home, or unpaid?
Seamus: Well, I think if there's the ability to work from home, then they can work from home. So my understanding there is that they are going to be quarantined until they get a test, and then the test could sort of dictate the next actions. But if they're quarantined until that point, I don't think that there would be SSP that would apply because they have to have the actual symptoms to qualify for statutory sick pay. And if they can work from home, then there's the ability to do that and to be paid for it. If it's a circumstance where you're unable to work from home, then you're back to the options of considering, you know, the alternatives. Could they take a period of unpaid leave or could they use some sort of leave for it?
And maybe just worth flagging up, Scott. Very grey area around the fact that if you are in quarantined for 14 days and get a test on day five, and it's negative whether or not you're permitted to return back from work at that point, I'm not clear about that. There's no clear guidance as I can see from any of the government websites on it and just to flag it up that not necessarily does a negative test mean that you can return back to work, and specifically just thinking about, if you've been on the family holiday and the whole family are required to quarantine that has been on holiday and the purpose would be that if you come out and go back into work after day two, but you're infected on day 5 by somebody else in the household, my understanding is that the 14 days is there for a specific reason. But as I say, it is grey about whether if you take a test and it's negative whether you can simply return to work at that point.
Scott: Okay, thank you very much. As you pointed out, if this person did have symptoms, then it would be covered by the SSP while they're awaiting their test and isolating. I suppose your point about the five days is it will take over seven days before it actually shows symptoms so that's the issue. You could have a negative and go back. It might well take you a while for these things to come through.
Okay. The next question:
An employee returning from Spain, and I want you to start self-isolation from 3rd August due to not being able to work from home because of their role. They then submitted a doctor cert from 3rd August for anxiety and stress. We have told them that they have to take unpaid leave, or annual leave for self-isolation period regardless of the doctor's line. Should we be paying SSP or occupational sick pay for this period. Our argument is that if the employee was fit for work, they would still be unable to attend due to the self-isolating, and we do not want to set a precedent, and other employees follow suit and submit doctors lines to cover for self-isolation, not because they have to self-isolate but because they're stressed because they've just got back from holiday.
Seamus: Yeah, I mean, I sympathise absolutely with the employer in relation to this one because you could take the view that someone has just been sharp, I'm going to the doctor and getting a sick line. And it's always very difficult to advise against a sick line whenever you've received it, and not to pay the SSP. If you don't do that, the employee can make an appeal through the Revenue & Customs about the failure to pay sick pay, and they can investigate and look at it. From my experience, and Revenue & Customs tend to fall in line with the medical evidence that's being provided so it's a difficult one. I can understand the frustration. Absolutely and the dangers of setting precedent. But where an employee presents a sick line for symptoms of anxiety and stress, I think that the safest option is to remit the SSP during a period of the sick line.
Scott: Okay, it's a bit cheeky but there you go. We used to get a lot of people who would, you know, put on a sick line for anxiety, then go on holiday because it's the best thing. Don't. You will get some cynics that will abuse it. Others where it's absolutely genuine and required. And that was one of the issues we chatted about at the beginning that people are going stir crazy. And you've got to balance that out and see that people actually need a holiday. And you know, it's part of the Working Time Regulations. They need a holiday. It's not necessarily a holiday where you're sitting in your house, and you're not allowed to go anywhere or do very much or, you know, the weather's like this, you know?
Anyway, here's another question:
What about staff who left for Spain before the announcement of the 14 days thing, so it's fairly recent or another country Belgium, Andorra, etc.? It could be France tomorrow. So they've picked a holiday, they're on holiday, and then they're stuck out there. It becomes one of those bad places because they've got to quarantine. Is it just a question of sympathy? The rules are much the same. Is it just you've got more sympathy for them than somebody that's going to go regardless?
Seamus: Yeah, I mean, look, certainly it's more understandable. And reading through some of the commentary I've read over the past couple of days that, you know, there would be a natural human instinct to feel sympathy for those people unless you're sort of taking a view of, well, you shouldn't have gone in the first place. That's right but it doesn't change the position and I still think that you should apply a, you know, it's important that you take a consistent view across the board, stick to your policy and procedure as to what to say if you put one together. If you haven't put it together, then stick by it to avoid any trouble down the line.
Scott: Okay. One of the practical issues is just got it here, a very good question.
Is the onus on the employer to determine where the employee has been if on leave, because most employers, certainly big employers, haven't a clue when someone has gone on holiday?
Seamus: No, I mean, I think that that . . . well, I think that ultimately these things have a way of getting back to the employer. I think the other employees' anxiety maybe heightened if there's somebody been away to an unsafe country abroad. And I think the employer has to carry out reasonable investigations. If there's a suspicion that the employee has been away, the employer should approach and have a conversation with an employee to find out what the circumstances are. And certainly the giveaway might be certainly if they haven't been holidaying in the UK or Ireland and they're very bronze and tan, there might be a bit of a giveaway there. You’ll not get it here at the minute.
Scott: I heard a lot of stories of people that were going to factories and meat processing places and so on. And they had symptoms of the virus, but they couldn't afford the pay cut because they're only on SSP or whatever. People are tempted. You know, they've been on their holiday. They go, "Look, I've got to go back to work. I'm on the quarantine list," and they're going to breach it. That probably would be certainly a disciplinary issue. And you mentioned that you're going to send them home, but I think this question here is saying look, going back to your policies should you be saying to people, "Where are you going on holiday because we're going to have to apply this quarantine, depending on where you been?" It might be whether there's an onus, it might be a wise thing to do.
Before you come back on that, there's another clever question here:
Can an employer ask to an employee to quarantine if somebody's been away, even if it's not on the official list?
And I suppose this is a question that came up at Legal Island . . . well, it was raised funny enough. If you're flying internally within the UK to London, Edinburgh, whatever, those places are more dangerous than Northern Ireland, and maybe some employees that are bit worried about, you know, working with somebody who's been on flights or have been using public transport a lot, that kind of thing, you know? I suppose it comes down to how scared are some employees. And so there's two points there, one should you be actively going to employers and saying, when are you going on holidays because if you're off on one of these things, I'm updating the list. You've got to tell us because you're not able to come back to work. And secondly, if it's just this travel thing, if it's more than likely that you're, you go to London that you might, when you go on the trip, you're much more at risk than if you get in a car and drive to Belfast.
Seamus: I think the first question is, I mentioned earlier on, yes, communication is key. There should be those discussions with employees that are going away. There's nothing wrong and nothing illegal about that unless you're getting to the point where you're harassing them about it. But that should be those open and frank conversations and discussions that take place particularly between the employer and employee by the destination of holidays and things like that. And I think it's entirely reasonable given the circumstances currently for that to take place, and you'd only be acting as a prudent employer.
And on the second question about heightened concerns, and I think where the employer is taking precautionary steps, and that there is an aspect where, fair enough. If you're going to be cautious about it, you could ask an employee to continue to work from home or rather than coming into work. Where the employee is able to present for work and is fit and able to do their job and they're not in breach of any sort of quarantine regulations, you might need to consider then having to pay the employee for the period that you're asking them to quarantine. So just be careful around that.
And, you know, the other side of it that I can see is certainly like the trade unions for many commentaries that I read were saying that if somebody follows the law, they shouldn't be penalised. And that there is a strong weight to that argument I think, but at the same time if 50 of your employees are going to say we're going to strike or we're not going to work because there's somebody coming in that we feel is a risk. Then as an employer, you probably need to take that on board as well and this is about the operation continues of your business. So there can be difficult decisions for the employer to take one way or the other.
Scott: Okay, we'll take one final question. It's actually two together. So we haven't got time to go through all your questions, folks. I apologise for that but we're going to take two. They come together to make the same point:
What if a member of an employee's household has been abroad? Does the employee have to self-isolate too even if they haven't been abroad?
And following on from that, the next question from someone else says:
What is the obligation of employees or employers to pay staff that are taking time off, as someone in their household is having to quarantine?
So you know, the teenage son and daughter goes off to Ayia Napa, or the Balearics and comes back, they have to quarantine. They're in the household. What happens there? And you have any idea whether they should be getting paid? The employee didn't go abroad but they've got someone quarantining.
Seamus: Well, I don't think there's any difference for the employee who decides to quarantine and is unable to attend work. I don't see that there's any obligation on the employer to take any additional steps, or if they don't attend the work, they're not entitled to pay. My understanding on the first question is that there isn't a requirement on someone who lives in the household. So, if your teenage daughter comes back from Spain and has to quarantine for 14 days, it doesn't oblige everybody in the household. It's only the person that has returned, but my . . .
I did look at this during the week and my understanding is that it's a similar process to, do you know of anyone that was shielding that lived in the house. There wasn't a necessity for everyone else in the household to shield, but it was a necessity for them to take precautions, i.e., you know, maybe the person that's shielding to eat at different times or the family eat in their bedroom or to use a different bathroom if it was available and different [toils 00:57:00] and things like that. So I think, in the house precautions, need to be taken. But so far as I can see, and from the guidance there's no requirement for someone who is living with a ... so if a flat mate comes back, there's no requirement for you to quarantine as well. And it's just them, but you should take those additional precautions.
Scott: Okay, well, thank you very much to Seamus. Thank you very much, everybody, for listening. We're going to leave it there. If you've missed any of it, you can listen back, of course. We'll have the transcript up as well shortly for those who subscribe. Now you can see the slide right in front of you there, the Annual Review of Employment Law includes the mighty Seamus McGranaghan. I think you're putting on employment status, isn't it?
Scott: And things like that. We hope to have the Uber case that's at the Supreme Court out by November. But even if not, then there's other cases such as . . . I saw a case last week in England where a hairdresser, who hired a chair in a hairdressers was deemed to be an employee, as well, or a worker rather and therefore entitled to various rights such as holiday pay, so you're going to be dealing with that but we've got everything else. If you go to the legal-island.com website, you can have a look at the program and all the so far confirmed speakers, two days online. It's going to be fantastic. We did an online event in July, and the feedback was out of this world. People loved it, so hopefully you'll enjoy that.
So that's it from us. You can get in touch with Seamus. You see the contact details there, or me or indeed Rolanda at Legal Island if you have other questions. We'll gather the questions that weren't answered, and we'll put those on for next month where they're relevant. But it could be on anything. It would be lovely to get some questions that aren't COVID related, so if you send those in, we'll deal with them on the 4th of September. Thanks very much, Seamus. Thanks very much, everybody. Hope to see you soon. Oh, that's the ambulance coming for you, Seamus. Goodbye.
Seamus: Bye.This article is correct at 07/08/2020
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