Partner Article

Businesses urged to follow furlough rules

Companies have been warned to abide by the rules of new Government Coronavirus measures – or leave themselves open to penalties.

Firms of all sizes have opted to furlough staff meaning that they are no longer actively working in the business but remain employees.

In return, the Government pay up 80 per cent of their salaries up to £2,500 a month and firms can elect to top up the salaries to their full levels.

However, the furloughed staff are not allowed to undertake any work directly or indirectly for their employers during their time out of the business – a period currently ranging from three weeks to three months.

Now the Coventry and Warwickshire Chamber of Commerce is warning members that they must stick closely to the rules.

Louise Bennett, chief executive of the Coventry and Warwickshire Chamber of Commerce, said: “The Government has announced unprecedented measures to help business survive this awful crisis. As we know, those measures have taken time to bed in because of the huge response.

“Our feedback is that furloughing has been a lifesaver for companies and as it has removed the immediate worry that a sudden and severe drop in business would cause widespread job losses.

“At the very least it has brought companies some much-needed breathing space but now firms are getting used to operating with reduced numbers it is essential that they adhere to the rules.

“Furloughed staff are not allowed to do any work for their employers directly and indirectly and while it might be tempting, companies must not call on staff they have effectively taken out of the business.

“The state is paying 80 per cent of salaries up to £2500 a month, so asking furloughed staff to work is direct cheating of state aid and thereby effectively fraudulent, and we are certain that HMRC and other authorities will be looking very closely at how the system has been applied once this crisis has passed.

“We hope that they will apply common sense when companies are operating under unique circumstances and have taken time to settle into the new patterns but if abuse if flagrant they are bound to act.

“If any company is unsure of the technicalities of the furlough scheme or any of the other measures, we would urge them to consult the Covid guides on our website.”

This was posted in Bdaily's Members' News section by Matt Joyce .