Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, pursuant to the Answer of 21 September 2020 to Question 85040, what statutory provisions are in place on the calculation of (a) statutory redundancy pay and (b) pay reductions under Coronavirus Job Retention Scheme furlough agreements.

The provisions relating to calculation of redundancy and notice pay under the Employment Rights Act continue to apply when an individual is on the Coronavirus Job Retention Scheme.

Employees who are dismissed due to redundancy and who satisfy certain qualifying conditions are statutorily entitled to a lump sum from their employer, based on their age, length of service and contractual weekly earnings, subject to a statutory upper limit, payable at, or soon after, the dismissal date.

The Government wants to ensure that employees do not lose out on their employment rights because they have been furloughed. We therefore introduced legislation on 31 July, which ensures that statutory redundancy pay and statutory notice pay and unfair dismissal compensation are based on an employee’s normal pay, rather than their furlough pay (potentially 80% of their normal wage).