Guidance for Employers
Furlough Decisions: Beware of Unintended Discrimination
The Job Retention Scheme has been launched by the government to protect employment by “furloughing” employees who would otherwise have been made redundant or laid-off due to the impact of Coronavirus. In this post, we want to provide guidance on the process of making decisions regarding who is furloughed and who isn’t.
Beware of Unintended Discrimination
24 March, 2020
by Uche Obi
The Job Retention Scheme has been launched by the government to protect employment by “furloughing” employees who would otherwise have been made redundant or laid-off due to the impact of Coronavirus.
In our previous post, “Job Retention Scheme – Caution: Employment Laws Still Apply”, we confirmed that the furlough decision is made by the authorised directors and managers. In this post, we want to provide guidance on the process of making decisions regarding who is furloughed and who isn’t.
We’re assuming that all readers of this post are intending to use the Job Retention Scheme in the manner it is intended, i.e., the selection of roles to furlough is a genuine response to minimise the impact of the Coronavirus on your business, and not game the system or use it fraudulently.
Also, this guidance is given based on information we have received from the websites of the UK government and other authorities so is subject to change as additional information is released.
1. Potential issues when deciding which roles or employees to furlough
The decision to furlough employees isn’t an on/off decision – the selection of roles to furlough can be made at location / site, department, team and individual levels. When making decisions at the individual level, a major risk that you must mitigate against is discrimination in selection of which individuals to furlough. Again, assuming all readers are not making deliberate discrimination decisions, you need to be mindful of unintended discrimination whilst trying to do the right thing.
For example, if a business has to furlough some of a team but not all, the decision might be to furlough the female employees with the rationale that they are likely to have children at home so the business is “doing them a favour”. That may well be true for some but not for all. The unintended consequences may effectively include a pay cut of 20% for the female employees and/or the male employees having to work for their money whilst the female employees get a “paid holiday”. Also, it may be that the male employees are better placed to look after the children and so are making their home lives more difficult.
Another example may be that a business furloughs the older workers in these roles as they are at higher risk from the virus. Again, that may be the case but, assuming they are in their fifties and sixties and have no underlying health condition, they may not want or need to self-isolate and don’t want the reduction in income whereas younger employees with children may need the time off.
As you can imagine, there are many variations upon this theme.
2. Approach to minimise risk of discrimination
So, what should you do?
We suggest the following approach:
- Before you make a decision on which roles, you must define and document the criteria upon which you make the decision. You don’t have to, but you may wish to consult with your employees or representatives during this definition but make it clear that they do not have the decision on the criteria.
- Once defined, many of the decisions, especially for sites, departments and teams may make themselves. Where, however, there are decisions about individuals, these need to be considered within the context of the criteria. Note: don’t be afraid to refine the criteria or make exceptions where necessary; just document the refinements or exceptions as you go.
- Keep the communication going to ensure that everyone is fully informed, and ideas are shared and refined.
As always, if in doubt, please seek help before acting as you don’t want the decisions you make with the best of intentions now to come back and bite you in the future.