Would you accept furlough or resign?

I'm an in-house lawyer in tech and have been "told" to accept furlough leave from next week.  The government's £2,500 will equate to about 30% of my normal salary and my employer is not offering to top it up.  It's going to be a struggle for my family given our financial commitments. 

I'm thinking it would be better to just hand in my notice and (presumably) take full pay for my 6-month notice period which is enough time to (hopefully) find a new job. 

Really keen to hear what others would do in this situation... my head is spinning.

Yes, how is that relevant?  Sorry, clearly missing something.

a friend who is doing furlough has been told she can take work elsewhere if she can find it

I was a bit surprised by this and haven't checked the rules to see if her employer is interpreting correctly

if this is the case, though, why not furlough and see if you can pick up something else/freelance in the meantime? Easier said than done I know.

Or alternatively it's just some pay until you do leave - it's not like they can reasonably hold you to a notice period!

oh wait sorry I misunderstood

hmm

are you sure you will get full pay for 6 months? seems unlikely

Will your co. be in a position to pay it (they don’t usually need to pay it in a lump sum and could theoretically insist u work notice and pay it that way)?

"£2,500 will equate to about 30% of my normal salary "

 

only 30%? get a better paying job next time

Tecco is suggesting you would be better off taking sick leave rather than accepting furlough. 

I would imagine if you resign they will simply furlough you during your notice period. 

Well I am on a 6 month notice period, and there is a provision for payment in lieu of notice.  So presumably my employer either has to make me work 6 months (i.e. no furlough; full pay) or they pay me 6 months wages and terminate my employment straight away. 

Well if you fall sick tomorrow you buy yourself a couple of weeks on full pay in order to make a decision.

Now I’m not wishing any illness on you but it would be most unfortunate for their furlough planning wouldn’t it, because you can’t be furloughed on sick leave afaik....

@lindaradlett - that is exactly my concern, but I am informed that furlough cannot be imposed and require's employee consent...

I would accept furlough, as I do not think your notice period will be paid like you think it will.

Look at a mortgage holiday if things are going to be too tight.

 

Though am surprised that a tech firm is needing to furlough at this time

@Phoebe C - yes, that's my concern.  I guess I need to reach out to an employment lawyer to look at my contract.  I work for a US tech company and 75% of the EMEA legal team has been put on furlough, including everyone at my (mid) level. 

the notice pay wouldn't benefit from the tax free amount is something to consider

 

Accept furlough, look for another job.  When you find it, resign with immediate effect.

If you think anyone - even mental US firms - is going to sue in the current climate you want your head read.

You have to agree to furlough, they can't force it on you. 

If you don't accept they have two options: continue on your current contractual pay or make you redundant. 

If you were made redundant you'd get your notice pay. 

Are they likely to go bust? My concern about furlough is the firm goes under and then can't afford the contractual notice period payments meaning 3 months at severely reduced pay then nothing. 

If you're confident they'll be solvent at the end of this, then it's merely a question of whether the furlough pay will be enough for you to live on. If not, take the redundancy. 

They will make you redundant then?

Or lay you off on £150 a week for *checks notes* one week?

 

Be careful.

 

And sick leave can be furloughed.

 

the only reason they pay you your 6months notice is if they want you out and there's no redundancy. Here presume it would be easy to say your job doesn't exist.

 

Finally - I think HMRC can claim back if you earn money elsewhere on furlough.

I thought that must be the case (re HMRC) but it's not what my friend was told. So much confusion.

Jelly, if they made you redundant they'd have to pay your contractual notice period, right? 

If they make you redundant they only have to pay statutory redundancy don't they - 1 week per year of service 

Jelly, your last para is incorrect.  You can't do any work whatsoever for the employer that has furloughed you but, from an HMRC perspective, you are free to take other work and it has no impact on your furlough pay.  Problem for most people, me included, is that the employer's terms of the furlough say no working for anyone else.

@lindaradlett - I don't know and redundancy pay is irrelevant to me anyway as I have been with the company less than two years.  But surely one still has to receive their notice, even in a redundancy situation?

@lindaradlett - erm, the link you provided specifically states 

Check your contract. Your employer may give you more than the statutory minimum, but they cannot give you less.

Yes good luck with that, given your employer says they have no need of you, hence furlough 

@lindaradlett - I think you're missing the point.  I don't care about the redundancy pay position; it is irrelevant to me.  It's a question of whether I will get paid my notice or not.  And, if so, whether it will be at full pay or whether they can somehow get out of it and pay me furlough pay.

If I were you I’d stay put for at least a couple of months. 

Have they indicated an intention to bring you back if and when sanctions ease?

Albeit you’d get paid for 6 months if you left (if they have the money) I think it’s too early to assume you can walk into another job where there is massive employee cost-cutting across the board.

And you've been there less than 2 years so have no statutory rights to redundancy at all 

My employment contract gives me 6 months notice, so you I don't  need "good luck with that" - I've got it.

For furlough to happen you have to agree.

If you are bedridden with illness surely you are in no position to agree.  Surely any ET is going to take a dim view if they sack you while sick during a worldwide pandemic.

 

There seems to be a lot of confusion here. OP if I were you I wouldn't dream of accepting furlough. People seem to be under a misapprehension you have to accept it - you don't if they aren't topping up. Whereas you're right that if you hand in your notice you get paid for that period. They could make you redundant but that makes no difference because they have to pay out your notice in addition to the paltry redundancy sum. 

Hools, are you sure your link says that? My reading is it's notice period at full pay + statutory redundancy. 

@lindaradlett, time to leave this thread.  You are clueless and showing your ineptitude.  Redundancy and notice pay are two completely different things. 

Username - id probably resign if you need to ensure cash flow.  I did that and got put straight into six months garden leave.  Full pay for playing on the Xbox. 

Again, much depends on the solvency of the firm and your personal circumstances. 

@Teclis - thanks for sharing; glad it worked out for you.  I hope I am as fortunate!

The point I am making is that if the OP refuses to accept furlough, his employer can simply say well we don't need you, you are redundant.  Oh and you've less than 2 years service.  Byeeee

No issues whatsoever with solvency of firm and I have zero concerns about their ability to pay. 

@lindaradlett - yes, they'd have to say "well we don't need you, you are redundant, here is your six months pay in lieu of notice, bye" .... and I'd say "awesome, thanks".

Then it's all down to your personal circs, whether you can afford it, how much you like your job and likelihood of getting a job in 6 months. 

If you can afford it, like your job and have concerns about the job market in your sector you may as well accept it. If they make you redundant you'll still get your 6 months. 

Hools, I hope you're not an employment lawyer! 

 

Am surprised how bullish people are being in the current climate.  The decision is obviously completely down to how you profile the risk, which is specific to your own situation, but I think most people are clinging to employment where they can, even on furlough.

 

if you resign they could furlough you for your notice period. 

But they cannot reduce your pay without your agreement. so they would have to pay in full, for the notice period. If they paid less you can sue for unlawful deductions. 

Or you could just say you would agree to furlough but only on full pay - they would then have to make you redundant or carry on paying you full. 

 

hth

 

@sorrydidyousaysomething - I get what you're saying.  But 3 months @30% of pay and then no guarantees I'll have a job at the end of it -versus- 6 months @100% of pay and time to find a new job is a no brainer to me. Even if I can't find a job within 6 months I can make 6 months of full pay last a lot longer than that when compared with the crappy Furlough pay.

Well then you already know the answer. Why have bothered asking the question?

Yeah the maths here have made the decision for you.

Hint: when you write the resignation letter don’t state any reasons, just a quick one or two lines of “as per section x of my employment contract I hereby give notice etc etc”.

Dont give anyone anything other than that.  

@Thuggy - the question is how sure can I be that I will actually have a contractual entitlement to 6 months of full pay.  Yes, I have a 6 month notice period but I am worried that I have missed something; for example, someone else on this thread said they could furlough me on my notice period (and therefore I'd end up having handed in my notice for no reason). I don't think that's right because they need consent to furlough but that's what I was trying to bottom out.

By that I mean don’t offer to work during the period or do any handover or even thank them for the opportunity.  Nothing at all. Keep it to barest of cold legal minimums.

Yes, what username said about more generous contractual provisions ffs.  TAKE PROPER EMPLOYMENT ADVICE URGENTLY BEFORE YOU AGREE TO ANYTHING.

Assuming all is as you would expect (i.e. you can resign and be paid in full) then assuming you are reasonably employable at the level of salary you earn now (i.e. you were getting calls regularly before this sh1t kicked off) then personally I would be tempted to tell them fvck off with the Furlough and that they can fire you if they want to get rid of you.  I would be even more inclined to do this if you think there is a risk the company could fail in a few months time (at LOT of companies are going to fail in a few months time tbh). 

Yes, what username said about more generous contractual provisions ffs.  TAKE PROPER EMPLOYMENT ADVICE URGENTLY BEFORE YOU AGREE TO ANYTHING.

Assuming all is as you would expect (i.e. you can resign and be paid in full) then assuming you are reasonably employable at the level of salary you earn now (i.e. you were getting calls regularly before this sh1t kicked off) then personally I would be tempted to tell them fvck off with the Furlough and that they can fire you if they want to get rid of you.  I would be even more inclined to do this if you think there is a risk the company could fail in a few months time (at LOT of companies are going to fail in a few months time tbh). 

@Teclis - I guess that's the next question, will they make me work my notice?  Especially now 25% of people are doing the work of everyone which, tbf, hadn't dried-up anywhere near to the extent necessary to furlough 75% of the workforce. 

Yeah I'm with you, there's a few ways it could pan out (there are other iterations):

- 3 months @ 30% then back up to full pay

- 3 months @ 30% then resign or redundant = 6 months' notice pay then new job on full pay (say plus or minus 10%) 

- 6 months @ 100% (resign or redundant) then immediate new job on full pay (plus or minus 10%)

- 6 months on full pay then ? period unemployed 

If it were me I'd go for furlough to see if the first scenario pans out.  But that's just me, and it's factoring in everything (family situation, job satisfaction etc)

 

ffs the correct legal position is set out above. 

you are welcome. 

 

No apparently they are too big to fail or something like that. Like Enron and Worldcom and Texaco and Lehman etc etc et bloody cetera. 

In this market I’d take furlough to sit on my ass for until the end of May with the hope there will then be a return to business as normal rather than quit and hope.  If things aren’t back to normal you can review the position then .  Remember the pay in your notice period is still taxed and at times like this there’s no guarantee of finding a job in six months.  Last time I got binned it took well over 18 months to get back into any kind of job and even then I was paid paralegal rates despite 8 years’ prior experience.

They'd probably make you work, the fuckers!

 

Yeah, they will probably make you work your notice period but you are only going to be stuck at home anyway and realistically you ain't getting a job anywhere for at least a couple of months so what do you care really?

I would seriously assume that you may be out of work for a year plus btw but I still think you are better off taking full pay for the next six months (and saving as much of it as you possibly can). 

RJR Nabisco is my favourite.

Brilliant book that “Barbarians at the gate”.  Well worth a Covid19 read if you like seeing how Junk bond funded PE can go so very horribly wrong...

Why on earth would he quit ffs?  I am not an employment lawyer but that makes no sense. Just tell them he isn't accepting furlough.  It will take them a little bit of time to figure out what they do about that I expect and they have to pay him in full in that time.  

What Donny said, with the provision you dont take it from Hoolie!

Let's hope Linda's advice to her real clients isn't as inept as her advice herein...cool

You don’t have to accept it but I would have thought if you handed notice in they would be contractually obliged to pay you your notice period?
 

alternatively what would you be contractually entitled to in a redundancy situation? if a better position than furlough just refuse it and see what they come back with. 

fucking hell, furlough is a variation to the terms of your contract, you have to agree to it, or not

are people just posting shit without reading the thread now? 

Whilst people are right that OP is entitled to refuse the furlough "offer", this is an extremely unusual environment and he's at a US-owned company where they'll be used to having employees with fuck all rights.

They are trying to get the wage bill down.  Don't be surprised if they say well you're unilaterally furloughed on nothing, or furloughed on £2.5k, or you can leave on nothing and, if you want any more out of us, you'll have to bring tribunal proceedings before a tribunal that's shut due to coronavirus.  Good luck.

"Don't be surprised if they say well you're unilaterally furloughed on nothing"

simple unlawful deduction claim - would be fast tracked and pretty much 100% chance of success. 

So yeah they might but then they might throw him bodily out of the window too. 

Stop being hysterical bed wetters. The legal framework here is very simple. 

Yeah if ET was up and running it would be different but full pay for six months even if he has to work it buys enough time to prepare for the future and ends the debate about whether he needs to prepare or not.  If he resigns, he knows he has to prepare.

Compared to six months of dread and doubt, i’d Prefer to take control of the situation myself and at least be going into it with my eyes open rather than sitting waiting for a brown envelope to come through the letterbox.

I think your missing the point though, one still has their contractual notice period (as outlined in the link you shared). You only end up with statutory if you don't have a contractual period or the contractual period is less than statutory. So it is not bye, it is bye in six months (in this case) or payment in lieu of notice (i.e. 6 months upfront to piss off now). What I don't know and would like to know, does any PILON pay attract tax if it is under £30,000?

does any PILON pay attract tax if it is under £30,000

 

no

 

Consider too whether PILON is treated as preferential creditor funds if it goes tits up?

For gods sake. Go talk to a proper employment lawyer TODAY. 

It is possible that the company will do something entirely unlawful as suggested above but it is pretty unlikely to be honest if they are a company of any size or for that matter a start up backed by institutional money.

No sane company wants a twitter storm from them unlawfully firing people without compensation in the middle of this coming down on their heads.

What sorry said @1257 is sadly probably not too far from reality.  

I believe they can furlough when you are on sick and also when you are in a notice period. 

Looks like you are going to have to take the furlough and look for something else, or try and ride it and hope you are back on full pay in 3-6 months.

Sorry to hear about your situation.

 

 

I agree with Donny Darko re. getting employment advice. However, I see that as no reason not to provide my unqualified experience.

Notwithstanding furloughs, redundancy etc... doesn't the OP have a  simple wrongful dismissal/breach of contract claim if they don't pay him as set out in his employment contract (i.e. 6 months notice either as a PILON or by making him work and paying in full)?

 

Kinda better when artoo and cookie were around given they actually had a clue what they were talking about rather than the guesswork of us lot heh.

Is he? I thought that was a rofMyth(tm)

In which case, whatever wibble said.

Anyway wilf and wibble have it the substantive answer (albeit I think wibble is wrong on the £30k/pilon thing).  Linda in this case does not. Lollers at thuggy

The OP is going to be furloughed, assuming he agrees to it.  If not they will probably find some way to make him redundant.

He can 'roll the dice', refuse furlough and see what happens.  But it sounds like the company is teetering on the brink and urgently needs to cut the wage bill to stay afloat.  

 

Heh.

I'm afraid we're going to have to furlough you Jim.

Is the company's financial position that bad Mick?

No Jim, it's just we think you're a cunt.

 

Hmm.  And they called me paranoid when I said someone had bugged my appraisal meetings.

Username - you should be grateful you are an Employee and not Self-Employed.  You would not get any Govt help if you were Self Employed on those earnings.

I'd resign, m8. Most of the fat cats on here could probably afford to live on a salary of £30k but for those with big mortgages etc it's out of the question.

Lol @ dux.  Yeah right, 30k.... some people probably pay more than that in childcare and schooling.  Get a grip.

PILON used to be taxable.  I got fired in March 2009 and got the firm to postpone paying it until April so it was a new tax year when I’d stay under the tax threshold because of going back to full time education.  That way it was PAYE’d but I was then able to reclaim the tax.

Besides looking at the employment angle, I'd simultaneously be looking to see if it's possible to temporarily reduce your financial commitments (presumably mainly mortgage/rent?) if you take the furlough option.

Also consider what future expenses (e.g. holiday) you've already paid but may be entitled to a reimbursement on, which could improve cash flow in the meantime.

 

PILON is not tax free unless structured properly through a settlement agreement.