Can migrant workers be furloughed?

Kezia Daley, Senior Associate, Immigration at Winckworth Sherwood considers whether furlough provisions can apply to migrant workers

Chancellor Rishi Sunak announced the extension of the Coronavirus Job Retention Scheme (CJRS) until October. The CJRS was originally open for three months (to the end of May) and backdated to apply from the 1 March.

The scheme allows firms to furlough employees, with the government paying cash grants of 80% of the employees’ wages (up to a maximum of £2,500). Employers having the choice to top up the remaining 20%.

We understand the scheme has been widely utilised for employees who are not sponsored under the points-based system. However, many companies who are hiring migrant workers are uncertain as to whether sponsored workers are eligible under the government’s furlough scheme. The confusion has been whether furloughing an employee would be treated as them accessing public funds, which is not permitted under a Tier 2 or Tier 5 visa.

The good news is that migrant workers on all visa categories are eligible under the scheme. This was confirmed by government guidance issued on the 26th March 2020 and updated on 20th April 2020. Companies that are struggling during this time but wish to retain migrant workers in the long term are encouraged to consider furloughing such staff. The government guidance reflects the importance of foreign migrant employees in the workforce, and the need for many companies to be able to work at full capacity once the pandemic has abated.

The CJRS has specific rules such that only employees who were on an employer’s PAYE payroll on or before 19 March 2020 and were notified to HMRC on a Real-Time Information submission on or before 19 March 2020 can be furloughed. It is likely that as a sponsor, an employer will still need to report to the Home Office that a worker has been furloughed, and any reduction in salary if not making up the extra 20%. Any reductions must be part of a company-wide policy to avoid redundancies and in which all workers are treated the same. These reductions must be temporary, and the employee’s pay must return to at least previous levels once these arrangements have ended.

Another source of confusion is what employees can do once they have been furloughed. It is important to be aware that if you do decide to furlough any of your sponsored migrant workforce you cannot expect them to undertake work for, or on behalf, of your business or any linked or associated organisation. This includes providing services or generating revenue. To do so would disqualify you from receiving the government grant towards their salaries.

Despite the current pandemic, the government is still pressing on with its proposed changes to immigration post-Brexit, with further guidance recently released. The new immigration system will make it more difficult for low skilled workers to obtain a Tier 2 work visa. Proceeding with these changes has been somewhat controversial, given how reliant we currently are on so called “low skilled workers”, which includes carers, supermarket staff and refuse collectors.