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Furlough Scheme and Notice Periods

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Many readers will have watched, with some bemusement, the panic on Twitter over the last fortnight caused by a sentence in HMRC guidance which said that employers can use the coronavirus job retention scheme to pay statutory notice.

Some people were concerned this meant that enhanced contractual notice periods would not be covered by the furlough scheme. (My attempts to reassure did not work).

HMRC has this morning updated its guidance to remove any uncertainty. The relevant passage now says: "You can continue to claim for a furloughed employee who is serving a statutory or contractual notice period, however grants cannot be used to substitute redundancy payments."

(Well done, by the way, to the employment teams at Howard Kennedy and Lewis Silkin, who persuaded HMRC to amend the guidance).