UKFT is preparing a series of guidelines to assist UK fashion and textile companies during the coronavirus outbreak. The guidelines will be updated as new guidance becomes available or the situation changes.

Coronavirus guidance regarding sick pay and employment

The Covid-19 virus is having an impact on many different aspects of business including how employers cope with sick pay. The following advice has been prepared for UKFT by the UKFT Employment Adviser.

When an employee is sick or self-isolating because of Covid-19, Statutory Sick Pay (SSP) is likely to apply. For businesses with fewer than 250 employees, the cost of providing 14 days of statutory sick pay per employee will be refunded by the Government in full.

However, there may be a problem when employees in a completely different area – e.g. warehouse or even a different factory – are consequently laid off simply because with another area shut down there is no work for them to do. In this case, they would not need to self-isolate and could not claim SSP.

The question of layoff then arises.

Some companies will still follow National Agreements which may include the right to layoff. Payments made are either in accordance with the Employment Rights Act for the first five days in any 13-week period or in accordance with the terms of the National Agreement, whichever is the higher.

However, the overwhelming majority of employment contracts are likely to only have a right to layoff in certain circumstances, such as the failure of supplies or power cuts.

If there is no contractual right to layoff, then an employer doing so is liable to claims of constructive dismissal.

Whilst it is expected that most employees would be sensible and understanding about layoff in such circumstances, some employees may be looking for a reason to resign with some form of compensatory payment which would be likely, in the best circumstances, to be at least as much as a redundancy payment.

For example, they could have requested redundancy or be in the middle of disciplinary or competence actions. Employers should be well aware of these risks.

Also note that employees who are laid off continuously for four weeks or whose earnings fall below 50% of average for six weeks out of 13 are entitled to claim an automatic redundancy payment. Further information is available on the ACAS website here.

UKFT members with specific employment queries relating to the impact of Covid-19 or any other query regarding employment law can email info@ukft.org. Alternatively, call UKFT on 020 7843 9460. Click here for further information on UKFT.